Retirement Plans – You Get The Deduction And Still Keep Your Tax-Free Money!

More deductible fringes!I believe that the opportunity to invest in real estate is the greatest fringe of all. But retirement plans are also excellent fringe benefits, which can provide for you a forced savings plan. You should avail yourself to these plans.

THE THREE MAIN ADVANTAGES OF RETIREMENT PLANS

• TAX DEDUCTIBLE — The contributions to the plan are currently tax deductible which generates tax dollars in your pocket, yet it’s ALL still your money! (Just the “pockets” change.) Moreover, the deduction is allowed in addition to whether you itemize deductions or take the IRS standard deduction. (Non-deductible contributions, covered later, can still be beneficial)
• TAX-FREE EARNINGS— The earnings on the already tax-deductible contributions accumulate tax-deferred until distributed. (With Roth’s they are tax-free)
• DISTRIBUTIONS CAN BE TAX FAVORED— Qualified retirement distributions do not have to be taken out until age 70-1/2. At this time such distributions are often taxed at lower rates because the participant is often not actively earning money as before. Also, the distributions can be spread out over a number of years. Certain distributions may be free of penalties.