We can help you determine if a 401(K) is the right choice for your business. Plans are administered by a third-party administrator (TPA) who works directly with Azzad. Plus, we'll help you build a well-diversified account that's based on your values, risk tolerance and goals.
| Your preferred investment option: |
|
Ethical Wrap Program |
Download Important Information |
Wrap Brochure |
Minimum to open |
$10,000* |
Download Plan Application |
Application (New plan? Complete worksheet) |
| Contributions |
Eligibility |
Businesses of any kind that want a more customized solution and a higher level of employee salary deferrals than other plans |
Contribution limit |
Employee contributions: salary deferral of up to $15,500 for 2008 ($16,500 for 2009); additional $5,000 ($5,500 for 2009) catch-up contribution for individuals over age 50. Employer contributions: Up to 25% of participant compensation. Together, employee and employer contributions cannot exceed the lesser of 100% of compensation or $46,000 for 2008 ($49,000 for 2009). |
Funding requirements |
Does not need to be funded annually |
Deadline |
To make contributions for the current tax year, plan must be generally opened by December 31. |
| Annual Tax Reporting |
Annual IRS Form 5500 filing required |
| Vesting |
Employee salary deferrals: 100% Immediate
Employer contributions: vary according to plan terms |
| Tax Advantages |
Contributions |
100% tax-deductible |
Earnings |
Grow tax-deferred (until withdrawn) |
| Withdrawals |
Taxable |
| Withdrawals |
Withdrawals after age 59½ |
Withdrawals are taxable income in the year received. |
Withdrawals before age 59½ |
Cannot take withdrawals from the plan until a "trigger" event occurs, such as turning age 59½, disability, and/or plan termination (certain exceptions may apply such as death, disability or hardship). |
Required withdrawals at age 70½ |
You must take out what are known as required minimum distributions from your plan when you reach age 70½. |
| Key Strengths |
Key Tradeoffs |
|
- You may be able to take out a 401 (K) loan; the interest you pay goes back into your account
- Not required to fund your plan each year
- Pretax contributions grow tax deferred
|
- Requires services of a third party administrator
- Can be expensive and complicated to administer
- Subject to strict ERISA and IRC rules with annual testing
|
* This information is not intended as tax advice. For more complete guidance on your particular financial situation, please consult your tax advisor or speak to an Azzad investment advisor at 888-862-9923. Please make sure to read the Azzad mutual funds' prospectus or Ethical Wrap Program's brochure before you invest. The wrap minimum applies after meeting standard minimum with other accounts.
