Unlock $5,000 in Tax Credits! ?? Small Business Owners, Don’t Miss This Golden Opportunity! ??

Unlocking $5,000 in Tax Credits with Secure Act 2.0: A Game-Changer for Small Businesses

Are you a small business owner looking to save on taxes while offering competitive benefits to your employees? The Secure Act 2.0 provides a golden opportunity to do just that. Passed by Congress, this legislation offers substantial tax credits to small businesses that create employee retirement plans—making it easier to attract and retain top talent while keeping more money in your pocket.

What is Secure Act 2.0?

The Secure Act 2.0 is an extension of the original Secure Act of 2019, designed to expand access to retirement savings and encourage small businesses to establish retirement plans for their employees. It’s packed with incentives, particularly for companies that might have found retirement plans cost-prohibitive in the past.

Here’s what the Secure Act 2.0 offers:

$5,000 in tax credits upfront: This credit is available to small businesses that create new retirement plans, covering startup costs and initial administration expenses.

$1,000 per employee for five years: In addition to the $5,000 startup credit, businesses can receive an additional $1,000 annually for up to five years. That could save up to $100,000 annually for companies with larger teams.

Why Should Small Businesses Care?

Offering competitive employee benefits is essential for small businesses to attract and retain top talent. With rising employee expectations, retirement plans are a key part of compensation packages. However, setting up a retirement plan has traditionally been expensive. Secure Act 2.0 changes that by offering tax credits that can significantly reduce your financial burden.

For example, a small business with 50 employees could qualify for $50,000 in annual tax credits over five years to implement a retirement plan. That’s money you can use to grow your business while ensuring your team is well-compensated.

How Can You Qualify for These Tax Credits?

To unlock these benefits, your business must:

Establish a new retirement plan: This can include 401(k) plans, SIMPLE IRAs, or SEP IRAs.

Have fewer than 100 employees: Only small businesses qualify for these credits.

Cover your plan’s startup costs: The $5,000 credit is designed to offset these expenses.

Are you unsure if your business qualifies? A quick consultation with a financial advisor can help determine whether you meet the requirements and guide you on how to proceed.

Take Advantage Now – While the Opportunity Lasts

Although the Secure Act 2.0 currently offers lasting tax credits, it’s important to remember that Congress can change this law anytime. By acting now, you can secure significant tax savings and enhance your ability to recruit and retain top talent with a comprehensive retirement plan. This positions your business competitively alongside larger companies, all at a fraction of the cost.

While the benefits are ongoing, they may not remain unchanged, so don’t wait to start reaping the rewards today.

FAQs About Secure Act 2.0

Q: How much can my business save with Secure Act 2.0? A: You can save up to $5,000 in tax credits upfront for starting a retirement plan and $1,000 per employee annually for five years. This means a business with 50 employees could save $50,000 per year for five years in tax credits.

Q: What expenses are covered by the tax credit? A: The tax credit covers costs associated with starting and maintaining a retirement plan, including legal fees, administrative costs, and employer contributions.

Q: Who qualifies for these tax credits? A: Your business must have no more than 100 employees and create a new retirement plan to qualify. Expanding an existing plan won’t qualify for the startup credits but may qualify for other benefits.

Q: What types of retirement plans are eligible? A: Eligible plans include 401(k)s, SIMPLE IRAs, and SEP IRAs. These are considered qualified retirement plans under the Secure Act 2.0.

Q: How long will these tax credits be available? A: The tax credits are available for five years after establishing your new retirement plan.

Q: How do I start setting up a retirement plan? A: Contact a financial advisor specializing in small business retirement plans to get started. They can help you navigate the process and ensure you qualify for the tax credits.

Final Thoughts

The Secure Act 2.0 is a win-win for small business owners and employees. By offering competitive benefits without the financial burden, you can attract top talent while taking advantage of significant tax savings. Whether you have 10 employees or 100, these incentives are designed to help you grow your business and provide your team with the benefits they deserve.

To learn more about how the Secure Act 2.0 can benefit your business, call Donald Morgan, AIF?, CPFA? at 509-931-1088 or visit IndependentWealthConnections.com today. Don’t miss out on these valuable tax credits!

Donald F. Morgan is a full-time financial advisor, serial entrepreneur, lifelong amateur economist, and political scientist. He is often seen on television news and quoted in publications as diverse as The Financial Times, US News and World Report, and Spokane Journal of Business. He and his wife Violet produced and directed a local television talk show, and he has had a column in the Coeur d’Alene Press. His views are his own.