Profit-sharing plan. The company must establish a profit-sharing plan by December 31 or by the end of the company’s fiscal year, but it doesn’t have to be funded until the tax-filing deadline. For calendar year-ends, that generally would be April 16, 2001, but with extensions it could go as late as October 15. Contributions are limited to 15 percent of your net income, or up to $30,000, whichever is less.

Keogh. The plan must be established by December 31, 2000, or fiscal year-end. Profit-sharing Keoghs don’t have to be funded until your tax-filing deadline, including extensions. Money-purchase Keoghs must be funded by the 15th day of the eighth month after the close of the fiscal year. For a profit-sharing Keogh, you can contribute up to 15 percent of your net income, or up to $24,000, whichever is less. For a money-purchase Keogh, the limits are 25 percent of income (20 percent for owner-employees) or up to $30,000.

Nonqualified deferred compensation. The employer must establish the plan by December 31. There are no contribution limits, but contributions are not deductible for the employer until the contributions are included in the employee’s taxable income.

401(k). The plan must be established by year-end. Contributions by employees must be made by the end of the year, but matching contributions from employers can be made as late as the tax filing deadline for a regular 401(k), plus extensions. This deadline does not apply to a SIMPLE 401(k). The maximum amount an employee can contribute in 2000 is up to 15 percent of pay or $10,500, whichever is less. Maximum contributions including employer contributions is 25 percent of pay or $30,000. The plan may require smaller maximums.

Traditional, nondeductible and Roth IRAs. For tax year 2000, you must establish and fund any of the forms of individual retirement accounts by April 16, 2001. There are no extensions. Maximum contributions are $2,000 a person, or total family earned income, whichever is less. 

You may be restricted on making deductible contributions or even opening a deductible IRA if your adjusted gross income is too high or you work for an employer with a retirement plan. For example, if you participate in an employer plan, deductible contributions to a regular IRA for 2000 start to phase out once adjusted gross income reaches $52,000 for married filing jointly. In the case of a Roth IRA, it doesn’t matter whether you participate in an employer plan, but your ability to contribute starts to phase out when your AGI reaches $150,000 (for joint  filers).

SEP. A simplified employee pension plan can be set up as late as the tax filing deadline, plus any extensions. For SEPs established under an employer, maximum contributions are the lesser of 15 percent of wages or $24,000. For self-employed SEPs, contributions are 13.0435 percent of net self-employment income up to $24,000.

SIMPLE IRAs. Sorry, you’re probably out of luck here for 2000. The deadline for establishing a Savings Incentive Match Plan for Employees, whether for employees or for yourself, was October 1, 2000. The exception to this rule is if you start your business after October 1, at which point you must establish the plan as soon as administratively possible. Once the plan is established, employers but not employees can make contributions as late as the tax filing deadline, but not extensions. The maximum employee contribution is $6,000, and combined employee and employer contributions can’t exceed $12,000 a year.

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July 2000— This column is produced by the Financial Planning Association, the membership organization for the financial planning community.