A 401(k) plan is a qualified deferred compensation plan which enables you to save money, lower taxes, and invest in your financial future. Under a 401(k) plan, your elective contributions are made on a before tax basis; that is, the amount deferred will be excluded from your taxable income. This may currently lower your taxes. The following are some advantages of our 401(k) plan.
- Elective deferrals are voluntary and the amount you contribute is up to you. (Federal Law limits the deferral to 100% of salary to a maximum of $18,000 in 2017.).
- Deferrals are made before tax; therefore, you pay less in Federal and State income taxes
- Earnings and income are not taxed until the money is distributed from the plan. When you receive your retirement benefit you may be in a lower tax bracket than you are currently.