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Author: RCtl146 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76074  
Subject: Small biz dilema Date: 12/21/1999 12:14 AM
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My wife's employer,a small legal firm, has promised to set up a retirement plan at the end of this year.
However, she already has an ira ,(foolishly invested)
and it has become apparent that her employer is CLUELESS as to how to set this up. He would like to
start off with $5000.
I'm aware that ira/rothira contributions can't exceed $2000.
What options are there, hopefully tax deffered, that
I may suggest to get this off the ground?
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Author: W401K Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 16691 of 76074
Subject: Re: Small biz dilema Date: 12/21/1999 8:58 AM
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Depending on the number of employees, a SIMPLE 401k Plan may be the best option. This can function as either an IRA or a 401k Plan. Under the SIMPLE plan, employees may defer up to $6,000 per year. This amount is adjusted for inflation periodically. The employer must make matching contributions. There are 2 different formulas they can follow.
Any pre-existing IRAs will not impact her eligibility to participate in the Plan. However, If she is elgiible for the new Plan at work, she may be limited or not able to deduct future contributions to an IRA outside of work.
Hope this helps,
Please follow up with any additional questions.

Bill
you can either e-mail me or post to the board.
bill_1066@excite.com

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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 16703 of 76074
Subject: Re: Small biz dilema Date: 12/21/1999 9:58 AM
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Greetings, RCtl146, and welcome. You wrote:

<<My wife's employer,a small legal firm, has promised to set up a retirement plan at the end of this year.
However, she already has an ira ,(foolishly invested)
and it has become apparent that her employer is CLUELESS as to how to set this up. He would like to
start off with $5000.
I'm aware that ira/rothira contributions can't exceed $2000.
What options are there, hopefully tax deffered, that
I may suggest to get this off the ground?>>


For some ideas, read my Foolish Retirement Plan Primer at http://www.fool.com/Retirement/Retirement.htm paying particular attention to those sections dealing with SEP, SIMPLE and Keogh plans. You will also find IRS Publication 560 (Retirement Plans for Small Business) helpful. Download that at http://www.irs.ustreas.gov/prod/forms_pubs/index.html.

Regards..Pixy

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Author: Donna405 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 16740 of 76074
Subject: Re: Small biz dilema Date: 12/21/1999 10:13 PM
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My wife's employer,a small legal firm, has promised to set up a retirement plan at the end of this year.

I would suggest your wife's employer look into a SEP-IRA, which accommodates much more than $2,000 per year contributions. It is based on the gross salary of the employee on a yearly basis.

Just a thought,

Donna


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