• 2000 – Repeal of IRC Section 415(e) gave highly compensated individuals the opportunity to open and fully fund a DB plan even if they had accumulated millions in defined contribution plans
  • 2001 – EGTRRA lowered the retirement age from 65 to 62 and increased retirement benefits from $140,000 in 2000 to $245,000 in 2022
  • 2006 – Pension Protection Act increased flexibility and allows for the combination of a Defined Benefit Plan with a 401(k)/Profit Sharing plan.  Increase contribution in early “windfall” years allowing for front loading
  • 2020 – Secure Act of 2020 Congress realized that America has a retirement planning crisis. So, to incentivize small business owners to offer retirement plans, they raised the tax credit limit from $1500 to $16,500. This dollar-for-dollar tax credit makes most plans set up a zero cost for the employer.
  • CalSavers Retirement Savings Trust Act. It requires California businesses with five or more California-based employees (one of whom is at least 18 years old) to offer either an employer-sponsored retirement plan or the state-sponsored retirement plan to their workers by June 30, 2022. Companies that don’t will be required to enroll in CalSavers, the state-sponsored individual retirement account (IRA), or face fines.
  •  The Tax Cuts and Jobs Act (TCJA) changed the tax law that affects high-income small business owners and self-employed individuals.

The TCJA changes increased the value of high contribution retirement plans like Designer DB Plus™. Taking these large tax deductions off the top line, you may bring your small business and self-employed clients below the taxable income thresholds ($340,100 married taxpayer, $170,050 single taxpayer in     2022). In addition, they may qualify for the 20% QBI (Qualified Business Income) deduction and save     them tens of thousands of dollars in tax liability.