Retirement Plans: Powerful Tools for Tax Savings & Wealth Building

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Guide Clients to Smart Retirement Plan Options

Many clients—especially self-employed individuals and small business owners—don’t realize they qualify for retirement plans that can reduce taxable income and grow wealth long-term. Whether it’s a SEP IRA, Solo 401(k), or traditional IRA, these plans offer significant benefits when used correctly. As their tax professional, you can be the one to introduce the right options—and refer them for expert help to get started.

  • Self-employed or 1099 clients with no retirement plan

  • High earners looking for tax deductions

  • Clients asking how to lower their taxable income

  • New business owners or side hustlers

  • Clients maxing out current retirement options

2026 Retirement Plan Limits & Benefits

Traditional IRA

Who It’s For:

Anyone with earned income

Roth IRA

Who It’s For:

Income-eligible savers (<$161k single / $240k MFJ)

401(k) / 403(b)

Who It’s For

Employees & business owners

Solo 401(k)

Who It’s For

Self-employed, no employees

SEP IRA

Who It’s For

Self-employed or biz owners

Simple IRA

Who It’s For

Small biz owners (≤100 employees)

2026 Contribution Limit:

$7,500
($8,600 age 50+)

 

Tax Advantage:

Deductible contributions (if eligible)

 

2026 Contribution Limit

$7,500
($8,600 age 50+)

 

Tax Advantage

Tax-free growth & withdrawals

 

2026 Contribution Limit

$24,500
($32,500 age 50+)

 

Tax Advantage

Pretax or Roth options available

 

2026 Contribution Limit

Up to $72,000+
(incl. employee & employer share)

 

Tax Advantage

High contribution limits + tax deferral

 

2026 Contribution Limit

Up to $72,000
(25% of comp max)

 

Tax Advantage

Employer contribution is tax deductible

 

2026 Contribution Limit

$17,000
($21,000 age 50+)

 

Tax Advantage

Employee + match; simplified setup

 

Quick Notes for Tax Pros

  • Traditional vs Roth: Traditional IRAs offer deductions now if eligible; Roth IRAs grow tax‑free on withdrawal later.

  • 401(k) catch‑ups: Clients 50+ can contribute extra, making it especially powerful for pre‑retirees.

  • Employer match: Encourage clients with employer plans to at least contribute enough to get the full match — it’s “free money.”

  • Solo 401(k): Great for self‑employed clients — allows both employee and employer contributions with high limits.

  • SEP IRA flexibility: Contributions vary year‑to‑year and aren’t mandatory — ideal for variable‑income businesses.

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