If your company is not in a position to offer a retirement plan, it makes good tax sense for you and your employees to consider contributing to a standard IRA or one of the new IRAs created by the Taxpayer Relief Act.
With the Roth IRA, named after its principal sponsor, Sen. William V. Roth Jr. (R-DE), annual contributions are not tax deductible, but you will be able to withdraw money without paying taxes if certain conditions are met. (See "11th Hour," December 1997.)
"Taking advantage of the Roth IRA might be more attractive than contributing to a 401(k) plan for some taxpayers," says Vines. "If you go into a 401(k), you get a deduction on the front end, so when you start taking out the money, it's all taxable. Some taxpayers may conclude it's better to forgo the deduction on the front end than to have free earnings coming out."
As you can see, pension plan options are plentiful. Don't delay--get the benefit of tax savings while you watch your nest egg grow.
Braverman, Codron & Co., 450 N. Roxbury Dr., 4th Fl., Beverly Hills, CA 90210, (310) 278-5850
CCH Inc., (847) 267-2484, http://www.toolkit.cch.com
Grant Thornton LLP, (202) 967-0580, fax: (202) 967-0582
Newman & Cohen CPA PC, (212) 967-0580, fax: (212) 967-0582