Qualified Plans

  Qualified accumulation is a way of saving and investing for retirement, with the primary objective to produce retirement income. Qualified plans receive special tax treatment on the money paid into them, as well as their earnings, during the accumulation period.

  Typical qualified plans include certain employer-sponsored retirement arrangements that are established for the benefit of the employees. So called 401(k) and 403(b) arrangements are examples, as well as profit sharing arrangements. Individual Retirement Accounts (IRAs) established by individuals on their own behalf may also qualify for tax benefits. In both cases, the arrangements must be set up in accordance with IRS requirements.

  Employers may make contributions on behalf of their employees and, subject to certain limits, deduct the contributions from their taxes. Employees enjoy even greater benefits.


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