WHAT IS A Profit Sharing Plan?
A profit sharing plan is a defined contribution plan under which the employer has the flexibility to contribute between 0% and 25% of eligible participants’ compensation. This contribution may be allocated based on salary, age, service or a combination of these factors. Profit sharing plans typically require more administration and paperwork than a Simplified Employee Pension or an IRA and may include yearly IRS filings. Also, at the time of retirement, the ultimate benefit is based on the participant’s account balance. CONTACT US TODAY