Owner-Only / Self-Employed

Owner-only and self-employed retirement plans – Exclusive (k) ®, SEP and SIMPLE IRAs, and defined-benefit plans – give business owners a tax-advantaged way to save for retirement.

What is an Exclusive (k) ® Plan?

The Exclusive (k) ® is a retirement savings plan specifically designed for self-employed business owners with no common-law employees.

Exclusive (k) ® Plan at a Glance

Who May Establish A company who employs only the owner(s) and their spouses, if applicable, and have no common-law employees.
Administrator Testing None.
Establishment New plans must be established by the last business day of the company’s fiscal year.
Employee Eligibility Requirements Owner(s) and their spouses, if the spouse is actively employed and receives W-2 income.
Excludable Employees Part-time employees (those working less than 1,000 hours per year).
Owner/Spouse Employee Contribution Limit Maximum employee deferral is the lesser of 100 percent of income or $18,000.
Catch-up Contributions Up to $6,000 for participants age 50 or older.
Employer Contributions Discretionary: Maximum of 20 percent of adjusted net business income or 25 percent of W-2 compensation after application of FICA, not to exceed $53,000 when combined with salary deferral feature. $59,000 for those age 50 and beyond.
Annual Custodial Fee $18

Exclusive (k) ® Benefits

  • Generally no third-party administration fees until the assets reach $250,000 or a loan is requested.
  • Potential for higher contribution limits than with a SEP IRA or profit sharing plan.
  • Employees that work less than 1,000 hours per year can be excluded from the plan.
  • Spouses who are employed by the company can elect to participate.
  • Loan feature available.