Do you have self-employment income? Does your spouse have income from a sideline business? If so, you might be able to shelter that income from tax with a SIMPLE (Savings Incentive Match Plans for Employees) retirement plan.
SIMPLE plans may work well for people with a small amount of income from self-employment or a sideline business. You can contribute (and deduct) 100 percent of that income, up to $10,500 in 2007. A 3 percent-of-income employer match also is available, as well as a $2,500 catch-up contribution for individuals who are at least 50 years old. As the name indicates, there is little paperwork involved with SIMPLE plans, especially SIMPLE IRAs.
In addition, you make your own investment decisions. If this prospect appeals to you, don’t procrastinate. A SIMPLE plan must be established by October 1 in order to provide tax benefits for 2007.
