If you are self-employed or a small business owner then you may want to consider a Midland Trust Individual K Plan. The Midland, K is a qualified plan for those who own or run a small business with no employees. One of the key benefits of an Individual K Plan is that a husband and wife can be covered under one plan, so there is no need for two Individual K Plans. This is great because it makes record keeping much easier.
A qualified plan is different from an IRA and has many additional benefits as well as additional paperwork. Midland will assist you in setting up your plan. Below are some benefits of a Midland Individual K Plan.
- Invest in real estate, private stocks, precious metals/gold, notes and mortgages as well as many other investments.
- Largest contribution amount of all retirement plans.
- Have checkbook control over funds and assets if you have Midland act as your third part administrator. An Indy K offers the same abilities as the checkbook LLC, but without having to hire a custodian or the added expense to create an LLC.
- Existing retirement funds including existing IRAs can be transferred into this new plan.
- Largest tax deductions.
- Increased retirement income because the Individual K plan allows you to contribute more than other plans so you have the option of saving more for retirement.
- Reduced business expenses – Take advantage of lower administration fees than a traditional 401(k) or profit sharing plan. If your plan owns a “C” corporation you may have the ability to draw a reasonable salary for the service you provide to the business entity.
- Retirement accounts can be UBIT/UBTI/UDFI exempt and do not pay income or gains taxes. That is not the case when an IRA owns real estate that carries mortgage debt. UBIT can apply.
- You can take a non-taxable loan from the account provided the funds are repaid within five years and at a reasonable interest rate. You can take a loan for up to $50,000 (or 50% of account value) for any reason as long as the loan is repaid over a term of five years.
- Tax returns only need to be filed for a Midland Individual K Plan if the plan assets exceed $250,000.
An Indy K Plan can be a powerful tool for small business owners. Between the loan provision (note: no IRAs have a loan provision to the IRA owner) and the Roth feature (many individuals are not a llowed to make Roth contributions because of their income), and the highest contribution limits of any plan, the Individual K is made for savvy investors.
To learn more or to open your Midland Trust Individual K Plan call (239) 333-1032.