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Pay john in cash .....No need to worry about taxes (!!) (1 viewing)
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TOPIC: Pay john in cash .....No need to worry about taxes (!!)
#177
ChenD (User)
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Which is better SEP or Simple IRA for small business ? 2006/08/22 12:19 Karma: 0  
SEP contribution levels are much higher than the Simple IRA, so whether it is a better retirement plan to offer to employees of a small business.

Consider a scenario :

1. Setup the SEP and reduce the pay of the employees so that their total contribution will be same. i.e. say john works for x company agreed for a salary of 100K pa. Now x company and john agreed on the retirement plan and company will contribute 40k to SEP plan and pay john 60K as wages.

Questions :
1. Does X company benefit in taxes in any way ?
2. John does not have to pay SS and Medical taxes, what about the X company ?
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#178
PRobert (User)
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Pay john in cash .....No need to worry about taxes (!!) 2006/08/24 16:30 Karma: 0  
Pay in cash..... No taxes problems for the employeess........But ..
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