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From Apache Wiki <wikidi...@apache.org>
Subject [Geronimo Wiki] Update of "WikiSandBox" by ForumWatcher
Date Thu, 19 Jan 2006 15:50:29 GMT
Dear Wiki user,

You have subscribed to a wiki page or wiki category on "Geronimo Wiki" for change notification.

The following page has been changed by ForumWatcher:
http://wiki.apache.org/geronimo/WikiSandBox

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  Testing this out!!!!
  
- http://www.roth-401k-forum.com
+ Roth 401k Only Available to a Few  
+   Only about one in three employers are expected to start [http://www.roth-401k-forum.com
Roth 401k Plans] in 2006. But, those who are self-employed, independent contractors, or business
owners with no employees, don’t have to wait. They can establish a Solo 401k with the Roth
feature and take advantage of that opportunity now.
  
+ Washington DC - New tax rules that went into effect in January 2006, allow a Roth feature
to be added to 401(k) plans. But millions of Americans will not have access to a Roth 401(k)
because, according to a Hewitt Associates survey, only about one in three employers are expected
to start Roth 401(k) plans in 2006. Still, those who are self-employed, independent contractors,
or business owners with no employees, can establish a Solo 401k with the Roth feature and
take advantage of the Roth 401(k) opportunity now, says Daniel Lamaute, retirement plan specialist
at Lamaute Capital, Inc.
+ 
+ With a 401(k) plan, participants reduce their taxes when part of their wages goes to their
401(k) account. The contributions and earnings from the account are not taxed as long as the
funds remain in the 401(k). However, the money is taxed at the time of withdrawal. Withdrawals
are required to begin at age 70 ½ under the Required Minimum Distribution rules.
+ 
+ By contrast, contributions to a Roth 401k are made with after-tax dollars. But no taxes
are paid at the time of withdrawal on the funds (principal and earnings) in a Roth 401(k)
account, provided certain requirements are met. So if taxes are higher in the future at least
the money that’s in a Roth 401(k) account will not get hit. A Roth account also gives more
control over the timing of distributions because one can transfer Roth 401(k) funds to a Roth
IRA and avoid the Required Minimum Distributions that would normally kick in at age 70 ½.
+ 
+ The major differences between a Roth IRA and Roth 401(k) are that 1) with a Roth 401(k)
one can contribute up to 4 times more as much as in a Roth IRA - $20,000 in year 2006 for
the Roth 401(k) vs. just $5,000 for the Roth IRA, and 2) high income individuals can contribute
to the Roth 401(k) but are prohibited to contribute to a Roth IRA.
+ 
+ Individuals with income from their own business (part-time or full time), and independent
contractor with 1099 income, should create their Solo-Roth 401(k) as soon as possible. That’s
because the opportunity to set up a Roth 401(k) plan expires in 5 years. Unless Congress changes
the laws, no new Roth contributions can be made after 2010. But funds that are already in
a Roth account can continue to grow tax-free.
+ 
+ The 401(k) with a Roth feature is a valuable tool for employees and small business owners.
It allows them to tailor their investments to meet their individual retirement objectives.
Individuals with their own business should ask their tax professional about this plan and
how it may benefit them. Anyone can visit www.investsafe.com to request a free information
kit on the Solo 401(k) that includes both a Roth feature and a loan feature.
+ 
+  
+ 

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