2015, 2016 and retirement plan opportunities

Here are 6 quick administrative tips to consider for you and your physician medical practice to help reach your retirement goals this year and beyond.

  1. Establish a Retirement plan this year – Receive up to a $500 tax credit for 2015 and an additional $500 for each of the next two years, for installing a first-time retirement plan.
  2. Maximize contributions to your retirement plan – Reduce your taxes in 2015 or consider Roth (post-tax) contributions if preferred. Review profit sharing formulas for optimal results.
  3. Weigh the type of plans available to stay aligned with your retirement program goals – Goals change over time. For example, if you have a SIMPLE IRA but want to contribute more, a 401(k) plan can be a good option (note that the switch from a SIMPLE IRA to a 401(k) must occur to allow a January 1 start date). Or if you have an existing 401(k) plan, considering adding a Profit Sharing component for 2015.
  4. Consider adding plan features – Look at automatic enrollment to increase participation and facilitate participant readiness. You may also want to consider adding Roth contributions, a loan option, or Safe Harbor provision to allow greater owner deferrals and satisfy compliance testing.
  5. Review compliance tests – Take action to manage compliance test results, i.e. owner and HCE excess contributions.
  6. Evaluate your plan expenses – It is your fiduciary duty to know your costs and ensure they are reasonable.

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