Safe Harbor 401(k) plan helps you save more with less hassle

Ideal for companies looking to adopt their first 401(k) plan or for companies that may have an existing SIMPLE or SEP plan

• Provide a retirement benefit to your employees while saving money with an affordable 401(k) plan
• Focus on running your business with our convenient, low maintenance plan
• Get started quickly with fast online plan setup
• Benefits from higher deferral limits than a SIMPLE IRA
• Reach your annual contribution goals more quickly than a SEP
• Receive a deduction from taxable business profits for contributions
• Become eligible for a tax credit of 50% ($1,000 maximum) of the administrative costs in the first three years of the new plan (for businesses with fewer than 100 employees)
• Nondiscrimination tests are satisfied
• Customize a plan to suit your business with our flexible plan design
• Automatic price discounts as your plan grows

For Plan Sponsor:

• 401(k) Safe Harbor plan with choice in Safe Harbor employer contribution
• Discretionary profit sharing contribution
• Non-discrimination tests are satisfied
• Allows for higher deferral limit than a SIMPLE IRA
• Daily Valuation with real-time access to plan information
• Allows for account consolidation and rollovers
• Government tax reporting – including 1099R and signature-ready Form 5500
• Administrative Manual and Forms Kit
• Non-standardized Prototype Plan Document and Adoption Agreement
• Summary Plan Description (SPD) and Loan Policy
• Sample Board of Directors Resolution
• Compatible with most major payroll providers
• Web based contribution processing and ACH payment of deposits
• Accommodates integration with social security
• Access to purchase a required ERISA Fidelity Bond
• Full-service, online access to administer and monitor plan
• Toll-free access to customer service support

For Employees:

• Retirement investing with a diverse list of index funds across multiple asset classes
• Higher contribution limits
• Model Portfolio selections designed for different investing goals
• Full-service, online access to check balances and manage account
• Online enrollment
• Online statements
• Annual statement mailed to the employee's home
• Access to tax-free loans - unlike SEPs or SIMPLE IRAs
• Allows for account consolidation and rollovers
• Toll-free access to customer service support

Q. What is a Safe Harbor 401(k) plan?

A. A Safe Harbor 401(k) is a 401(k) that automatically satisfies the nondiscrimination rules for elective deferrals and employer contributions. For a 401(k) plan to be considered a safe harbor plan, employers must satisfy certain contribution, vesting and notice requirements.

Q. Who is the best target organization?

A. This ShareBuilder 401k simplifies your company's program in a good way. By providing an employee matching contribution, business owners and other highly compensated personnel can contribute the maximum allowed, and at the same time, the plan automatically satisfies IRS non-discrimination testing - a real hassle saver. It's sometimes called a Safe Harbor 401(k) plan. This plan is great for companies with a consistent stream of income and helps employers and employees alike get the most out of the program.

Q. What are the mandatory employer contribution requirements for the Simplified 401(k)?

A. Simplified 401(k) has been designed to satisfy nondiscrimination requirements. Employers can choose between two safe harbor contribution options as defined below:

• An employer matching contribution of 100% of employee elective contributions on the first 4%, 5% or 6% of compensation
• An employer non-elective contribution of 3% - 6% of compensation for all eligible employees

Both of these accounts are 100% vested and are required to be funded on a per-pay-period basis.

Q. Does the Simplified 401(k) allow for a profit sharing contribution?

A. Yes, Simplified 401(k) allows for the employer to make discretionary profit sharing contributions annually at the end of the year. The profit sharing contribution is subject to a vesting schedule. The profit sharing contribution component can also be integrated with Social Security without incurring additional fees.

Q. What type of enrollment materials are needed?

A. Enrollment is handled online and no hard copy information is disbursed.

Q. What are some of the plan design features of Simplified 401(k)?

A. Simplified 401(k) is a standard offering that allows you to leverage a cost effective retirement plan. The Simplified 401(k) program:

• Allows for employee elective and catch-up contributions
• Allows for up to 2 outstanding loans
• Allows for either an employer safe harbor matching contribution or a non-elective contribution
• Allows for rollovers from other qualified retirement plans

Q: Are any tax credits available to offset 401(k) plan fees?

A: Yes. In many cases, you may be eligible to receive a tax credit for 50% of your setup and annual administration fees or $500 (whichever is less). This credit can be taken each year for the first three years of the 401(k) plan. This credit may be taken in addition to any tax deductions you may be eligible to take for plan contributions.

To take this credit, you must employ at least one person who is not considered to be a highly-compensated employee (defined as a person who owns greater than 5% of the company or who earns more than $100,000 per year). In addition, you must employ fewer than 100 persons who earned more than $5,000 in the previous year. For additional details about this credit or to confirm that you are eligible, please consult your accountant or tax adviser.

Q. When does the Simplified 401(k) have to be established?

A. The plan must be established at least three months before the end of the plan year. Plan setup requirements are contingent on the plan type being adopted and whether or not it is an existing or startup plan. Specific deadlines are set prior to the end of the year.

This information does not constitute tax advice. Please consult your tax adviser for specific tax information.