Do you run a small business that can’t afford a retirement plan? Times have changed. This may be your year.
New tax credits in the federal SECURE 2.0 Act make it easier – and far more affordable – for small businesses to offer retirement savings plans.
Addressing a national retirement crisis
Our Congressional friends are motivated by a growing national problem: Nearly half of American households have no retirement savings.
Lawmakers understand that the nation’s 31.7 million small businesses and their 60 million employees are a vital part of our economy. Yet only about a third offer retirement plans.
Why? Many business owners say they simply can’t afford them.
SECURE 2.0 seeks to change this. The new law increases the three-year startup tax credit to 100% of plan startup costs and administration fees. By offsetting those fees, the new tax credit makes it nearly free for employers to start and administer a 401(k) retirement plan.
This could be great news for small business owners wishing to show appreciation and retain their skilled and talented workforce.
As with any new law, the devil is in the details. For more information, check out the podcast linked above. Our guest Nick Xinopoulos, QKA with Trinity Pension Consultants, does a great job explaining the SECURE 2.0 tax credits.
