Sullivan & Company - Certified Public Accountants 4709 Montgomery Lane #201 - Bethesda, MD, 20814 Phone: 301-657-8080




Paul Sullivan, CPA

Sullivan & Company


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September 2010 Articles

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Feature Articles

- A SIMPLE Retirement Plan for the Self-Employed

- Should You Invest in Life Insurance?

- Employee Relocation in a Suffering Market

- 10 Things You Should Know About Identity Theft

Tax Tips

- 8 Tips for Taxpayers Who Owe Money to the IRS

- What Income Is Nontaxable?

- Moving Soon? Let the IRS Know

- Gift Taxes

- Tips for Recently Married or Divorced Taxpayers

QuickBooks Tips

- Take Charge This Fall: Use QuickBooks's Budgeting Tools

Financial Planning Tips

- Create a Living Will

- Update Your Will

- Review Your Budget vs Actuals



If your CPA isn't providing this type of information to you as a

client each month, maybe it's time to talk with or switch to Paul

Sullivan at Sullivan & Company CPAs.  To set up an appointment to

talk with Paul at 800-652-6521 or in Bethesda call 301-657-8080.

A SIMPLE Retirement Plan for the Self-Employed


Of all the retirement plans available to small business owners, the SIMPLE plan is the easiest to set up and the least expensive to manage.


These plans are intended to encourage small business employers to offer retirement coverage to their employees. 


SIMPLE plans work well for small business owners who don't want to spend time and high administration fees associated with more complex retirement plans.


SIMPLE plans really shine for self-employed business owners. Here's why...


Self-employed business owners contribute both as employee and employer, with both contributions made from self-employment earnings.


SIMPLEs calculate contributions in two steps:

Employee out-of-salary contribution

The limit on this "elective deferral" is $11,500 in 2010, after which it can rise further with the cost of living.

Catch-up. Owner-employees age 50 or over can make a further $2,500 deductible "catch-up" contribution as employee in 2010.

Employer "matching" contribution

The employer match equals 3% of employee's earnings.

Example: A 52-year-old owner-employee with self-employment earnings of $40,000 could contribute and deduct $11,500 as employee plus a further $2,500 employee catch-up contribution, plus $1,200 (3% of $40,000) employer match, or a total of $15,200.


The rest of the article talks about What's Not So Good About SIMPLES, Keogh's, SEP's and SIMPLES compared and What's Not So Good About Simples.


For more cash flow information click on the rest of the article.  Or if you want to talk or ask me questions, call me, Paul Sullivan, at 240-316-3531.



As always you can call our offices if you have any questions about these or any other accounting related issues, at 301-657-8080. 


Regards, Paul Sullivan, CPA



Sullivan & Company, CPAs | 4709 Montgomery Lane | Bethesda, Md. 20814 | email:

Direct: 240-316-3531 | Main no.: 301-657-8080 Ext 102 | Fax: 301-657-9055