UPDATED FOR 2025 – 2/3/25 4:44 PM

Dear Client,

When it comes to saving for retirement as a small business owner, you have several options. Here’s a quick guide to help you choose the best plan for your situation:

Traditional or Roth IRA

• What It Is: A straightforward retirement account that you can set up even if you have no employees.

• Contribution Limits for 2025: $7,000 (or $8,000 if you’re 50 or older).

• Need Help Deciding? We’re here to explain the differences between Roth and Traditional IRAs.

SEP IRA

• What It Is: Ideal for self-employed individuals or small businesses with a few employees.

• Contribution Limits for 2025: Up to 25% of your net self-employment income or $70,000, whichever is lower.

SIMPLE IRA

• What It Is: Great for businesses with fewer than 100 employees who want to set up a savings plan.

• Contribution Limits for 2025: Up to $16,500. Contributions are deductible, and those made to employee accounts count as deductible business expenses.

Solo 401(k)

• What It Is: Perfect if you have no employees other than your spouse and want to make significant contributions.

• Contribution Limits for 2025: As an employee, you can contribute up to $23,500 (or 100% of your income, whichever is less). As an employer, you can add up to 25% of your income. Your spouse can also contribute.

Each plan has its benefits depending on your business structure and personal needs. If you’re unsure which option is right for you, let’s discuss your choices together.

Sincerely,

W.E. Stevens PC

Serving you through a thoughtful client experience, wise long-term perspective, and very experienced staff