Q: Our small company does not have a retirement plan. Can the company contribute to a Roth IRA on my behalf if I'm one of the company principals? P.H., Columbia, Md.
A: Yes. A company may contribute to a Roth IRA or traditional IRA (or combination of both) for an eligible employee up to the annual limits for such IRAs. The current limit is $3,000 per year. But any employer-paid contribution must be treated as compensation for tax purposes. The contribution is also subject to payroll taxes. In effect, it's as if you were paid extra compensation and made the contribution yourself. Depending on your income, you may be able to deduct all or part of a company contribution to a traditional IRA. All things considered, however, it's a whole lot easier to simply make IRA contributions on your own, rather than through a company plan.
Like what you've read? ...Republish it and share great business tips!
Attention: Readers, Publishers, Editors, Bloggers, Media, Webmasters and more...
We believe great content should be read and passed around. After all, knowledge IS power. And good business can become great with the right information at their fingertips. If you'd like to share any of the insightful articles on BusinessManagementDaily.com, you may republish or syndicate it without charge.
The only thing we ask is that you keep the article exactly as it was written and formatted. You also need to include an attribution statement and link to the article.
" This information is proudly provided by Business Management Daily.com: http://www.businessmanagementdaily.com/5716/company-can-contribute-to-your-roth-ira "