With Tax Rates Expected to Rise with a President Obama Election Win, Investors Turning to Solo 401(k) Plan to Shelter More Income, According To Tax Attorney
A President Obama election win would mean an increase in the capital gains tax rate to 20 percent for higher earners, investors looking to use retirement funds to shelter income from higher tax rates
Miami, FL (PRWEB) October 24, 2012
With the outcome of the presidential election Nov. 6 increasingly uncertain, a certainty is that a President Obama victory would surely mean an increase in the capital gain tax rate from 15% to 20% for high-income earners, according to Adam Bergman, tax attorney with the IRA Financial Group. Accordingly, many investors have begun looking for ways to maximize their retirement investment gains, which are tax-deferred. A report commissioned by the IRA Financial Group found that many retirement investors are concerned with the potential for increased tax rates on capital gains and are seeking to focus on building their tax-deferred retirement accounts via a solo 401k plan. “We have seen a surge in investors looking to establish solo 401(k) plans in an effort to increase their retirement accounts to take advantage of the attractive tax-deferral options, “ stated Adam Bergman, a tax attorney with the IRA Financial Group. “Americans are concerned with the potential for increased tax rates on capital gain investments and are seeking more tax-advantaged investment structures, such as the self-directed IRA and Solo 401(k) Plan,” stated Mr. Bergman.
Under the 2012 new Solo 401(k) contribution rules, a plan participant under the age of 50 can make a maximum employee deferral contribution in the amount of $17,000. That amount can be made in pre-tax or after-tax (Roth). On the profit sharing side, the business can make a 25% (20% in the case of a sole proprietorship or single member LLC) profit sharing contribution up to a combined maximum, including the employee deferral, of $50,000. For plan participants over the age of 50, an individual can make a maximum employee deferral contribution in the amount of $22,500. That amount can be made in pre-tax or after-tax (Roth). On the profit sharing side, the business can make a 25% (20% in the case of a sole proprietorship or single member LLC) profit sharing contribution up to a combined maximum, including the employee deferral, of $55,500. “The individual 401k Plan offers self-employed and small business owners with the opportunity to push more money into a tax-deferred retirement account allowing them to shelter more income from potential increasing tax rates, “ stated Maria Ritsi, a paralegal with the IRA Financial Group.
A Solo 401K, also known as an Individual 401K Plan, offers a self-employed business owner the ability to use their retirement funds to make almost any type of investment on their own, including real estate, tax liens, and precious metals without requiring the consent of any custodian or person. “With IRA Financial Group's self directed IRA LLC and solo 401(k) plan solutions, buying rental properties is as simple as writing a check and is tax-free, “ stated Ms. Ritsi. “As the manager of your Self-Directed IRA LLC or trustee of the individual 401k plan, the retirement account holder will have control over his or her retirement funds so that a real estate purchase can be made by simply writing a check,” stated Jacky Ospina, a paralegal with the iRA Financial Group.. One major advantage of making investments properties with a Self-Directed IRA or individual 401(k) plan is that all income and gains generated by the investment would be tax-deferred until a distribution is taken.
The IRA Financial Group was founded by a group of top law firm tax and ERISA lawyers who have worked at some of the largest law firms in the United States, such as White & Case LLP, Dewey & LeBoeuf LLP, and Thelen LLP.
IRA Financial Group is the market's leading “checkbook control Self Directed IRA Facilitator. IRA Financial Group has helped thousands of clients take back control over their retirement funds while gaining the ability to invest in almost any type of investment, including real estate without custodian consent.
To learn more about the IRA Financial Group please visit our website at http://www.irafinancialgroup.com or call 800-472-0646.
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