My preferred type of retirement plan is Savings Incentive Match Plan for Employees or SIMPLE IRA. The SIMPLE IRA was created to make it easier for small businesses with 100 or fewer employees to offer a tax-advantaged, company sponsored retirement plan.

With a SIMPLE IRA you and your eligible employees may contribute up to 3% of earned income (with a maximum contribution of $10,000) on a pre-tax basis to individual SIMPLE IRAs. You must deduct Social Security and Medicaid from your gross income, but you can then make your SIMPLE IRA contribution before other taxes are levied, effectively lowering your taxable income.

As employer you must make “matching” or “non-elective” contributions into your employees’ SIMPLE IRA accounts. Matching contributions means that business matches elective deferral contributions made by employees. For example, if employee opts to contribute 3% of his salary to plan, employer must match 3% contribution.

At first you might cringe at matching your employees’ contributions, but as business owner and an employee yourself this can be great news. As an employee of your own business you can contribute up to $10,000 to your SIMPLE IRA and business can then match your contribution dollar-for-dollar, which means that you can put up to $20,000 in tax free dollars into plan per year. The cost of contributions is also deductible as a business expense.

The non-elective contribution option requires that company contribute 2% of every employee’s earned income to plan on employee’s behalf regardless of whether or not employee contributes to plan himself. For 2005 maximum contribution you would be required to make is $4,200.

Like a traditional IRA, you can withdraw money from a SIMPLE IRA at any time; however distributions within first two years of participation are subject to higher early withdrawal penalties than traditional IRAs or Roth IRAs. Withdrawals within first two years are subject to a 25% early withdrawal penalty. Withdrawals taken after first two years are subject to a 10% early withdrawal penalty.

As employer, advantages of a SIMPLE IRA include: company contributions to plan are tax deductible as a business expense; plan documents are simple and easy to administer; administration costs are low; and there is no government reporting required by employer.

The advantages of a SIMPLE IRA for your employees include: contributions are immediately 100% vested; contributions and earnings are tax-deferred until withdrawal; employees can contribute 100% of earned income up to $10,000 for 2005; and employees can direct their own investments within IRA.

This is a complex topic and I’ve just tipped iceberg here, but hopefully this will give you enough information to get investment ball rolling.

Here’s to your success!

Tim Knox

Finding a vendor to handle your blank business check supply is easy on internet. There are many companies online that offer printing services. You can expect to find aforementioned styles of checks, and maybe a few more options specific to printer. You pick styles and designs that you find applicable to your business. There are many color schemes and designs, but there may be a better option.

New to check world is photo check. A few check printers allow you to submit a JPEG photo or graphic and they will print it on your checks. What this means, is that for a few dollars more, your business logo will be placed on your checks. You get more exposure for your business, and it really doesn’t cost that much more.

The orders only take about a week of so, or faster if you rush order. You’ll find that many of these sites also provide many other needed office items like pens, paper supplies, and staples. When you buy all your stuff in one place, it leaves you with more time to get your business off ground.