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Subject:Pre-tax savings for contractors From:Yvonne DeGraw <yvonne -at- SILCOM -dot- COM> Date:Thu, 14 May 1998 09:05:44 -0700
Chris Welch-Hutchings wrote:
>I also like being able to sock away a lot of pre-tax $$$
>into a 401K, and get stock options too!
I can't dispute that we contractors have to buy our stocks at market price.
Just wanted to point out that most US contractors should be socking away
money either post-tax via a Roth IRA (if the income limits don't exclude
you) and/or pre-tax via a SEP-IRA or Keogh. The effective contribution
limits for a SEP-IRA are about 13% of net and for a Keogh about 22% of net.