Question

Chad and Sue have successfully owned and operated their bakery for 10 years and have decided to plan for their retirement. They are not incorporated and have no full-time employees, and want a qualified plan to maximize the tax advantages while at the same time not bog them down with paperwork. Which of the following plans would be their best option.

Answer 1

Answer:

c. Simplified Employee Pension (SEP)

Explanation:

A simplified employee pension (SEP) is known as a retirement package that a company establish for the employees in the company. Furthermore, the company allows a monthly contribution in form of a tax deduction from the employees' monthly salaries. Therefore, based on the description provided in the problem, the correct answer is a Simplified Employee Pension (SEP).