A Keogh plan (also called HR10 plans) is a tax-deferred retirement plan for self-employed individuals or unincorporated businesses.
Why It's Important
It's important to note that contributions to these plans are tax-deductible up to a certain amount. There are two types of Keogh plans. One type is a qualified defined-contribution plan. This type of plan is typically in the form of a profit-sharing plan. The beauty is that a business doesn't have to generate profits to participate in this type of plan. As of 2019, a business can put 100% of their income or up to $56,000 of funds into this plan. Profit-sharing plans are only contributed to by the employer (yourself if you are self employed) not the employee. It's a good way to squirrel away money when your company is doing well.
The other type of Keogh plan is a qualified defined-benefit plan. These types of plans are similar to pensions in that you get paid out annually after...
Always wondered about Roth IRAs? Join Tiffany as she breaks down what they are and how to best utilize them.
This is a listener request episode. If you want to have your question featured, please submit on our website.