401k Plans

For any type of public or private company. 401k plans are generally most appropriate for companies with 20 or more employees.

Eligibility

A Business 401(k) plan is available to any employer—regardless of size—who wants to offer retirement benefits to one or more employees. Eligible businesses include sole proprietorships, partnerships, LLCs, S corporations, C corporations, and nonprofit organizations. Employers must adopt a written plan document and meet annual compliance and reporting obligations.

Contribution Limits

Employees can contribute through elective salary deferrals, up to the annual IRS limit. In addition, employers may choose to make matching or non-elective contributions. The combined contribution limit per participant is subject to annual IRS maximums. Contributions can be made on a pre-tax basis, and many plans also support Roth contributions.

Tax Benefits

Employee contributions are typically made on a pre-tax basis, reducing their taxable income. Employer contributions are tax-deductible as a business expense. Investment earnings within the plan grow tax-deferred until withdrawal. If Roth contributions are available, participants may contribute after-tax dollars and withdraw qualified earnings tax-free in retirement.

Who contributes

401(k) plans allows contributions from both employees and the employer. Employees can choose to defer a portion of their wages into the plan on a pre-tax or Roth basis, depending on the plan’s structure. Employers may offer matching contributions—such as a percentage of employee deferrals—or non-elective contributions made on behalf of all eligible employees, regardless of whether they contribute themselves. These employer contributions are discretionary and can be designed to support specific talent retention or compensation strategies. The combination of employee and employer contributions creates a powerful framework for building retirement savings and improving overall plan participation.

Withdrawals & Distributions

Withdrawals from the plan cannot be taken until a qualifying event occurs, such as reaching age 59½, becoming disabled, or passing away. Early withdrawals are generally subject to a 10% penalty in addition to regular income taxes. Required Minimum Distributions (RMDs) must begin at age 72, unless the IRS provides updated guidance.

Fees & Expenses

Global Advisers provides transparent, fee-based investment management for your 401(k) plan. There is no cost to open or close a plan. Ongoing plan administration, recordkeeping, and compliance testing are handled by third-party providers, and associated fees vary depending on the plan’s complexity, number of participants, and chosen investments. All fees are fully disclosed and benchmarked.

Administrative responsibilities

As a plan sponsor, the business is responsible for ensuring the plan complies with IRS and Department of Labor (DOL) regulations. This includes annual nondiscrimination testing, Form 5500 filing, and timely remittance of employee contributions. Global Advisers coordinates with trusted third-party administrators (TPAs) and recordkeepers to help ensure compliance and reduce your administrative burden.

Deadlines

401(k) plans must generally be established by the last day of your business’s tax year to make elective deferrals for that year. Employer contributions may be made up to your tax filing deadline, including extensions. Safe Harbor plans must be adopted before October 1 to be effective for the current year.