A word from Ripple Wealth Management Financial Advisors about Safe Harbor 401k management
Now is the perfect time for business owners that are using a SIMPLE IRA or a SIMPLE 401(k) as their retirement plan and discuss converting to a traditional or Safe Harbor 401(k) plan with them.
This is also a great time to get a Safe Harbor plan in place for 2022 if they do not currently have a retirement plan.
Why do it? Allows business owners to save more for retirement 401(k) can allow for Roth Deferrals More flexible eligibility requirements (can require employees to work for 1 year, work 1000 hours in a year and be 21 years of age for example) Fantastic tax credits for the first 3 years to offset start-up costs – please see the attached flyer.
Key dates: Notice of intent to convert to a 401(k) must be sent to employees by November 1, 2022 SIMPLE contributions must cease by December 31, 2022 if the plan wants to make 401(k) contributions in 2023. Safe Harbor plans for 2022 must be in place by October 1, 2022.
How to do it? Give Shuwun a call to connect with a trusted Financial Advisor to help you make this happen.