Age
40
45
50
55
60
Max. Annual Tax defer Contribution $33,000
$52,000
$78,000
$93,000
$125,000
| Profit sharing plans are the easiest of all retirement plans to understand. They permit the employer to make pro rata contributions of up to 15% pay to all eligible employees to the plan and allocate it pro rata among plan participants. Age-based or new comparability allocation methods permit allocations to favor older, higher paid employees. Since they allow the employer to vary the contribution level from year to year, they are also among the most flexible of all retirement plans. Employers (taxable and tax exempt) may base the contribution percentage on the profitability of business-hence the name "profit sharing" plan. . . Info request |
