One practical solution seems to have flown under the radar.
Strategy: Set up a Section 401(h) plan. This little-noticed arrangement pays for costs associated with the sickness, accident, hospitalization and medical expenses of retired employees, their spouses and their dependents.
Distributions used for qualified purposes are completely tax-free to plan participants. This can enable you to save tens of thousands of dollars over time.
Here’s the whole story: Small business owners can prepare for the future by establishing a qualified retirement plan. For example, you may have started a defined benefit plan, like a traditional pension plan, years ago. As with other qualified plans, the pension plan is subject to tax-law limits. For 2010, contrib...(register to read more)