Keogh Plan


Are you a self employed individual?

 

You may establish a Keogh Plan on or before the end of the tax year (December 31st).  Once established, contributions may be made until the tax return deadline for applicable tax year (i.e. April 15).

 

A Keogh Plan is a type of qualified retirement plan available for self-employed individuals, as well as for those who own unincorporated businesses, or who own more than 10% of a special partnership or a corporation of individuals.

 

 Reasons to open a Keogh Plan?

 

  • The maximum annual deductible contribution is up to 25% of your net income with a limit of $50,000 for year ending on December 31, 2012, whichever is less1
  • Accumulated contributions and gains are tax deferred until retirement, which provide you with an important financial planning tool that could assist you in saving for your retirement

 

Who is elegible?

 

  • Self-employed individuals
  •  Individuals who own unincorporated businesses
  •  Partners of special partnerships who own more than 10% of the partnership, or shareholders who own more than 10% of a Corporation of individuals

 

 Why Banco Popular?

 

  • The trust for the Keogh Plan has been qualified by the Puerto Rico Department of the Treasury.
  •  Your plan will be administered by the best qualified team in the industry which includes: financial advisors and certified financial planners.  
  •  Banco Popular is the largest commercial bank in Puerto Rico with a fiduciary services division having more than 50 years of experience and currently managing over $17 billion in trust assets.
  •  You can access your account online

 

We can visit you at your office or home to help you establish your Keogh Plan. To schedule an appointment call us at 787-294-2552 or click here . Once your Keogh plan is established, you have until the tax return deadline for the following year (i.e. April 15) in order to make your plan contribution.

 

The content of this material is for informational purposes only and is not intended as tax advice.  Banco Popular de Puerto Rico, its subsidiaries or affiliates are not engaged in rendering legal, accounting or tax advice.  If legal, accounting, or tax assistance is required, the service of a competent professional should be sought.  Contributions and the proceeds derived therefrom, if any, may be invested in investment products which are not insured by FDIC, are not deposits, obligations, nor are guaranteed by Banco Popular de Puerto Rico and involve risks, including the possible loss of the invested principal. Brokerage services are offered through Popular Securities, Inc.,  registered broker/dealer, member FINRA & SPIC. Popular Securities, Inc. is a subsidiary of Popular, Inc. and is affiliated with Banco Popular de Puerto Rico. Popular, Inc. and Banco Popular de Puerto Rico are not registered broker/dealers.

1

Contributions in excess of the deductible limit will pay a tax equivalent to 10% even if the non-deductible contribution is not claimed as a deduction on your income tax return.  For 2012, the maximum annual employer and employee contribution amount per participant will be the lesser of $50,000 or 100% of the participant’s  Compensation.  Also, the maximum compensation per participant to be used for determining contributions to the Plan shall not exceed $250,000.00.