|General Description||As a small business owner with no employees, you may be able to contribute more than with other retirement plans.|
An Individual 401(k) may work well if you have income of less than $200,000 and want to maximize your retirement savings. With an Individual 401(k) you have the flexibility to change how much your business contributes from year to year.
|Eligibility to Contribute||You can contribute at any age if you are self-employed or a business partner.|
|Maximum Annual Contribution||May use a combination of salary deferral and profit sharing contributions.|
|Tax-Deductible Contributions||As a small business owner, you can deduct your contributions for yourself, and your business partner from your company’s federal taxable income.|
Your plan may now allow you to allocate part or all of your deferral to a Roth 401(k). Roth 401(k) salary deferrals are not tax deductible but contributions and earnings have the potential to grow tax deferred and may be eligible for income tax free withdrawals if held for five years and attaining age 59 ½.
|Taxation of Earnings and Withdrawals||Tax-deductible contributions and earnings are taxed as ordinary income when withdrawn.|
|Types of Investments||Mutual Funds available through Wells Fargo Advisors, LLC.|
|Minimum Initial Investment||Varies by investment option|
|Withdrawal Penalties||10% IRS early withdrawal penalty if withdrawn before age 59 ½ unless exception applies.|
|Required Withdrawals||Must begin at age 70 ½.|
|Deadline to Set Up and Fund||Plan must be established by the last day of the business’ fiscal year.|
|Commissions and Fees||Varies by account and investments|
Learn more about saving for retirement; contact a Wells Fargo financial professional today!
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