Profit Sharing Plans
A Profit Sharing Plan is one of the most flexible qualified retirement plans.
Contributions are discretionary, meaning you can raise, lower, or eliminate contributions
as your profits dictate from year to year. Profit sharing plans can be integrated
with Social Security, an advantage which can provide business owners and key employees
with additional benefits.
Why Provide a Profit Sharing Plan?
All contributions to a Profit Sharing Plan (up to the allowable limit)
are deductible for federal and, in most cases, state income tax purposes.
This favorable tax treatment may provide a reduction in your companys
current taxes. If you are self-employed, contributions are deductible
on your personal tax return.
All contributions to your Profit Sharing Plan account compound
tax-deferred until withdrawn at retirement. Your investment can accumulate
more quickly than in a non tax-deferred investment vehicle.
Generous Contribution Limits
You may be able to contribute as much as 25% or up to $50,000 in 2012, whichever
is less, to a Profit Sharing Plan account.
An Attractive Employee Benefit
Small business owners may set up a Profit Sharing Plan as
a way to compete with larger businesses for quality employees. This popular
and highly visible employee benefit can help you attract and retain the
employees you need to succeed in today's competitive business environment.
Unlike large company plans, a Profit Sharing Plan is easy to establish and
For more information on establishing a Profit Sharing Plan, visit wellsfargo.com.