Money Purchase Retirement Plan

A Money Purchase Plan is an Employer Funded Plan like a Profit Sharing Plan. Limits on deposits, eligibility and vesting are the same as Profit Sharing. Once a deposit level (percentage) is selected the deposit MUST be made each year regardless of profits.

• Employer contributions can be up to 25% of eligible employees’ salary up to $46,000 per year.
• Employees may not contribute.
• Contributions are tax deductible to the employer.
• Vesting schedules can apply.
• Employer contributions can be Integrated with Social Security to favor the highly-compensated employees.
• New employees can “rollover” prior balances from their former employer’s plan.

Maximum Eligibility:

• 21 Years of age.
• 1 Year of Service (2 years if 100% vested).
• Full Time (1,000 hrs/year. This requirement is available if the Service requirement is 1 year.)
• May exclude collectively bargained employees.
• May exclude non-resident employees with no U.S.-source income. (e.g.: a foreign subsidiary)