401K setup

Status
Not open for further replies.
Code:
Rewire said:
Has anyone set up a 401K program fpr thier employees? We want to add this benefit for our staff but I am not sure where to start
Click to expand...

I set up a simple IRA a few years back for my employees. It really isn't to bad. I went through fidelity and they helped me over the phone if I had any questions. Plus, the cost is minimum compared to setting up a traditional 401K.
 
chris1971 said:
Code:

I set up a simple IRA a few years back for my employees. It really isn't to bad. I went through fidelity and they helped me over the phone if I had any questions. Plus, the cost is minimum compared to setting up a traditional 401K.
Click to expand...

what are the tax advantages for your business compared to the 401K ?
 
A true 401(K) means that you put in matching funds, up to a certain amount. You could look at a 457 which is employee only contribution, and it's pretax, meaning that if they make $500 and put $100 into their account, their paychek is only taxed on $400. They will not be taxed until they draw out the money.

A 401(K) may be pretax also, but I'm not sure.
 
cowboyjwc said:
A true 401(K) means that you put in matching funds, up to a certain amount. You could look at a 457 which is employee only contribution, and it's pretax, meaning that if they make $500 and put $100 into their account, their paychek is only taxed on $400. They will not be taxed until they draw out the money.

A 401(K) may be pretax also, but I'm not sure.
Click to expand...

I think you are wrong there. A 401k is by definition pre-tax. There are other section numbers for post-tax payroll deduction accounts.
And there is no requirement for the employer to make any sort of matching contribution. I know, because half of the 401ks I participated in had no matching.
If the employer does do matching, there are rules that prohibit structuring it in a way that benefits highly paid employees more than the average employee.

Another good reason for at least talking to a CPA if not hiring an outside plan servicing company.
 
our payroll company ADP is able to set us up with a 401K our vaccountant will administer it. They are snding the paperwork and it will take about six weeks to set everything up the payroll company will tak responsibility for ninsuring all payments are deductd and sent to the 401K. They said they will tak care of all the compliance issus for th govrnment and our accountant will work with our employes so thy can choose from the various funds available . W ar starting at 1% matching which allows me to max out at the end of year for myself. I think this will be a freat bnefit for the tam and help to gain long term employees.
 
GoldDigger said:
I think you are wrong there. A 401k is by definition pre-tax. There are other section numbers for post-tax payroll deduction accounts.
And there is no requirement for the employer to make any sort of matching contribution. I know, because half of the 401ks I participated in had no matching.
If the employer does do matching, there are rules that prohibit structuring it in a way that benefits highly paid employees more than the average employee.

Another good reason for at least talking to a CPA if not hiring an outside plan servicing company.
Click to expand...

You could be right, my wife has a 401(K) as does management for the city and they are matching funds accounts. General Unit, which is what I am, has a seperate 457 which has no matching funds.
 
We went through Edward Jones and I am glad we have it. Some of the employees money is pre tax and some is not. I they can do 6% and we match it. I believe it is between 4% and 6% of what you are allowed to match. I say go for it. You will be a better employer in the long run.
 
Status
Not open for further replies.
Top