Piggy-back a SEP and Roth 401(k) for a C Corp.
Can a C corporation open up a Roth 401k plan even though the company offers a SEP plan. Are there criteria to a Roth 401k that would make this undesirable as a piggy-back to the SEP.
Can a C corporation open up a Roth 401k plan even though the company offers a SEP plan. Are there criteria to a Roth 401k that would make this undesirable as a piggy-back to the SEP.
Permalink Submitted by BruceM on Wed, 2008-12-03 21:24
Maybe.
If the company is using the IRS model 5305-SEP, it cannot coexist with another plan. But if the corp is using a prototype or master plan SEP, then the corp can tandem with another QRP if they wish…however, all annual contribution limits and non-discrimination testing applies.
BruceM
Permalink Submitted by charles lore on Thu, 2008-12-04 02:42
What is a model 5305 SEP ? What is difference from a “regular” SEP?
Permalink Submitted by BruceM on Thu, 2008-12-04 16:17
A SEP is a SEP, it just depends on who writes the plan.
The model 5305 SEP is the most popular because it’s the easiest. Take a look at the IRS on-line resource guide for setting up a 5305-SEP
http://www.irs.gov/retirement/article/0,,id=137850,00.html
BruceM