Abbott Pratt Tax Talks – Spotlighting the Retirement Plan Credit
Who doesn’t love tax credits?! They are a dollar for dollar reduction of your tax liability.
The IRS has a specific credit for qualified businesses that has added a SEP, SIMPLE or qualified retirement plan.
If qualified, your business may be eligible for a credit up to 50% of the costs, with a maximum credit of $500 per year, for costs incurred to set up the retirement plan, administer the plan, and costs incurred to educate your employees about the plan.
So long as the plan remains, you are eligible to receive this credit for the first 3 years that the plan is in place.
As with any credit, there are additional requirements that will need to be reviewed and discussed to ensure you are eligible for the maximum credit.
Every opportunity matters when it comes to taking full advantage of deductions and credits. Be sure not to overlook these credits that will minimize your tax bill not just this year but in the years to come.