Which kind of retirement plan can a 75-employee for profit corporation establish?

Rationale

SIMPLE IRA is the retirement plan a 75-employee for profit corporation can establish.

A SIMPLE IRA (Savings Incentive Match Plan for Employees Individual Retirement Account) is specifically designed for small businesses with fewer than 100 employees, making it a suitable option for a corporation with 75 employees. This plan allows both employer and employee contributions, providing a straightforward way to save for retirement.

A (Roth IRA.) YOUR ANSWER

A Roth IRA is an individual retirement account that allows individuals to contribute after-tax income. It is not a plan that corporations can establish for their employees, as it is designed for personal use and does not involve employer contributions or employee matching.

B (403(b).) YOUR ANSWER

A 403(b) plan is intended for certain non-profit organizations, such as public schools and tax-exempt organizations. Since the question specifies a for-profit corporation, a 403(b) is not applicable as it is not designed for profit-oriented businesses.

C (SIMPLE IRA.) CORRECT

A SIMPLE IRA is explicitly designed for small businesses with fewer than 100 employees, making it a fitting choice for a 75-employee for-profit corporation. This plan allows employers to contribute to employees' retirement savings, making it an attractive option for small business owners looking to provide retirement benefits.

D (Keogh.) YOUR ANSWER

A Keogh plan is a type of retirement plan for self-employed individuals and unincorporated businesses, which means it is not suitable for a corporation with employees. While it allows higher contribution limits for self-employed individuals, it does not cater to the needs of a corporation like the one described in the question.

Conclusion

In summary, a SIMPLE IRA stands out as the appropriate retirement plan for a for-profit corporation with 75 employees, as it is specifically designed for small businesses. Other options like Roth IRA, 403(b), and Keogh plans either do not apply to corporations or are intended for different types of organizations, reinforcing the suitability of the SIMPLE IRA in this scenario.

Which kind of retirement plan can a 75-employee for profit corporation establish?

SIMPLE IRA is the retirement plan a 75-employee for profit corporation can establish.

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