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This is the time of year when many of your best clients and prospects are feeling the pain of tax season. Tax bills for 2004 loom as April 15 approaches — which makes it the perfect time for you to introduce small business owners to significant tax saving opportunities for 2005. The Small Business Pension ProgramSM is a defined benefit retirement plan designed specifically for self-employed and small business baby boomers who earn high incomes. The program allows annual contributions of $100k or more, which translates into tax savings of as much as $40,000+ each year. Compare the Small Business Pension Program to SEPs, 401(k)s and other options.
Introduce the Small Business Pension Program now — before clients start contributing to another program for 2005. They are likely to be appreciative of this innovative idea and you may be able to gather additional assets. Review our quick eligibility check list and check your small business client and prospect rosters to see which clients may be suitable for this program. Businesses with fiscal year-end dates other than December 31 (e.g., June 30, 2005) must open 2005 plans before their year-end. Run a test proposal now to find contribution levels and tax savings for your clients. Show them the print-out — it will tell the story for you.
Learn more: Visit the www.smallbizpension.com website for more information including marketing tools and sales support.
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According to a January 10, 2005 Wall Street Journal1 (WSJ) report, "Why Dentists Are Earning More", dentists have started making more money than many types of physicians, while typically working fewer hours. The Journal reported dentists are "handily outpacing doctors, in part because dentists have avoided being flattened by the managed-care steamroller, and instead many have turned into upscale marketers." The WSJ continues "many optional procedures aren't covered by insurance, leaving dentists free to charge whatever the market will bear." The image conscious are choosing optional treatments such as teeth whitening, veneer jobs and full "smile makeovers".
Recent data from the Bureau of Labor Statistics pegs the number of dentists in the U.S at over 150,000.2 The Small Business Pension Program is your opportunity to put a smile on their faces by helping to relieve some of the tax consequences among this high-earning group of health professionals. While you're at it, think of all those other businesses that cater to the image conscious: plastic surgeons, dermatologists, laser eye centers, acupuncturists, chiropractors, etc. By introducing them to the Small Business Pension Program, you can help them potentially gain significant tax savings with an IRS qualified retirement plan.
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Access Dentist Prospects
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1.
Talk to your own dentist, to clients who are dentists and to friends about their dentists. Read the material on our website and describe the plan basics to them. Generally, you're looking for someone age 45+ with less than five employees. If they don't qualify they probably know other dentists who do. It's a great way to create interest in the Small Business Pension Program and you since they are likely to reference you in the conversation. |
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2.
Use the Internet to get information on dentists in your area. At www.dental-site.itgo.com under 'organizations' you'll find state and national groups. These sites are a wealth of information. Some include member rosters and convention listings. You could give a presentation at a meeting or set up a booth at a conference to garner leads.
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3.
To find dentists in your area, go to www.dentistry.com. You can search for dental professionals by zip code. Many of these include a full description of the practice and their website addresses.
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4.
The American Dental Association website www.ada.org is another place to find robust information. Click on 'events and meetings', then on 'calendar' for a detailed list of dental conferences throughout the year by date. This site is also a resource for finding ADA dentists in your area.
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5.
Use our prospecting letters as a direct mail tool. It's easy to customize the letters with your name and contact information. Local dental organizations may provide contact lists for a nominal fee. |
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Bring a smile to the faces of these professionals with your knowledge of the benefits the Small Business Pension Program can bring to their practice.
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1 Wall Street Journal, January 10, 2005. |
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2 Bureau of Labor Statistics, February 2004. |
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EMJAY Retirement Plan Services, Inc. is now the third party administration (TPA) firm for the Small Business Pension Program. As of January 1, 2005, EMJAY acquired the retirement plan services business from Metavante Corporation. The same experienced sales support team is in place to assist you. EMJAY is nationally recognized as a customer-oriented pension administrator with strong compliance expertise that actively supports its partners in the marketing and sale of retirement plans.
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Contribution Deadlines
If you have already opened plans for your clients, now is the time to gather and invest those contributions. Your client's business entity type will determine the final deadlines for required contributions.
Corporations, S-Corporations and LLCs electing to be taxed as either a corporation or S-Corp.:
To be deductible, the required contribution must be deposited by the due date of the employer's tax return, which is 2 1/2 months after the fiscal year end (March 15th for a December 31st fiscal year end). If an extension of time is filed, the contribution must be deposited no later than the minimum funding deadline of 8 1/2 months after the plan year end (September 15th for a December 31st plan year end).
Sole Proprietorships, Partnerships and LLCs electing to be taxed as either a sole proprietorship or partnership:
To be deductible, the required contribution must be deposited by the due date of the employer's tax return, which is April 15th for a December 31st fiscal year end. If an extension of time is filed, the contribution must be deposited no later than the minimum funding deadline of September 15th, even though the extension of time expires on October 15th.
UBS Financial Services Inc. does not provide legal or tax advice. Clients should be advised to consult with their legal/tax advisor when making decisions about a retirement plan.
The Small Business Pension Program is a service mark of UBS Financial Services Inc.
Not for public use.
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How it Took Just a Phone Call
to Make a Small Town
Dentist Grateful for his
Small Business Pension Program
Peg Dahme in Princeton, New Jersey has worked as a Financial Advisor for 25 years. When she read about the Small Business Pension Program in Financial Advisor she knew just the right client for it. A 54-year-old family dentist in the small town of Califon, New Jersey had been a client for 19 years. So she picked up the phone.
Just One Phone Call
The dentist has kept his business simple. No computer, a dial-up phone and only part-time employees. When he heard about the Small Business Pension Program, he agreed that it was perfect for him. His wife, a radiologist, has a high income, so she can support their lifestyle while he saves for their retirement. After printing out the proposal from the website, the FA mailed it to her client. He was "very grateful" for her advice and for the prospect of large tax savings over several years.
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| The Results in this Case |
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Time from introducing the program to the sale:two weeks
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First year contribution to the plan: $75,000 |
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First year taxes saved: about $30,000 |
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The dentist had a money purchase plan and a profit sharing plan that he terminated and rolled into an IRA. As UBS Financial Services Inc. does not provide tax or legal advice, Dahme spoke to her client's CPA who did not know about the defined benefit program for small businesses, but was happy to learn about it. The TPA was helpful in setting up the program, making it a painless experience for the FA.
To help identify who could benefit from this program, Dahme highly recommends running a Financial Goal Analysis. Using it to prospect helps her recognize who needs to save more aggressively for retirement. Dahme says, "I offer this program in every case where it's appropriate. People appreciate my knowledge about it." When is the best time to present the program? "There's no bad time. And tax time would certainly be appropriate!"
Source: Telephone interview conducted by Leaffer Shapiro, LLC, February 2005.
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KEY DATES
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FUNDING DEADLINE:
Plans must be funded when
taxes are filed and no later
than September 15 for
calendar year plans
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| Questions? |
For more information call Retirement Consulting Services at: 1-(888)-738-1546, option 1.
Our proposal generator
is now updated to reflect
2005 increased limits.
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