J DARDEN INSURANCE & FINANCIAL SERVICES

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1 OppenheimerFunds Retirement OPPENHEIMER FUNDS SINGLE K SM J DARDEN INSURANCE & FINANCIAL SERVICES REPRESENTATIVE IS REGISTERED WITH AND OFFERS ONLY SECURITIES AND ADVISORY SERVICES THROUGH: PLANMEMBER SECURITIES CORPORATION, A REGISTERED BROKER/DEALER, INVESTMENT ADVISOR AND MEMBER FINRA/SIPC 6187 CARPINTERIA AVE, CARPINTERIA, CA , (800) *J. DARDEN INSURANCE & FINANCIAL SERVICES AND PLANMEMBER SECURITIES CORPORATION ARE INDEPENDENTLY OWNED AND OPERATED. PLANMEMBER IS NOT RESPONSIBLE OR LIABLE FOR ANCILLARY PRODUCTS OR SERVICES OFFERED BY J. DARDEN INSURANCE & FINANCIAL SERVICES OR THIS REPRESENTATIVE. TX LIFE LICENSE The financial advisor indicated above and his or her firm are not associated with OppenheimerFunds, Inc. or any of its affiliates. Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency and involve investment risks, including the possible loss of the principal amount invested. Oppenheimer funds are distributed by OppenheimerFunds Distributor, Inc. Two World Financial Center, 225 Liberty Street, New York, NY OppenheimerFunds Distributor, Inc. All rights reserved. 1

2 WHAT IS A SINGLE K PLAN? Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency and involve investment risks, including the possible loss of the principal amount invested. Oppenheimer funds are distributed by OppenheimerFunds Distributor, Inc. Two World Financial Center, 225 Liberty Street, New York, NY OppenheimerFunds Distributor, Inc. All rights reserved. 2

3 Types of Businesses Designed for 1. Corporations*, Partnerships, Sole Proprietorships and Non-profit entities that employ: Owners and immediate family members Owners with part-time or seasonal employees that can be excluded from the plan 2. Existing SEP or Profit-sharing clients seeking to maximize the benefit they receive from a plan. * Business can be incorporated or unincorporated. 3

4 Prime Candidates for Single K plans Home businesses Doctors/Attorneys Brokers Real estate agents Shop owners Moonlighters Board members Insurance agents Consultants 4

5 Common Law Employees Depends on whether employees can be excluded from the plan Businesses with full-time employees that are not immediate family members cannot take advantage of a Single K plan, consider a Traditional 401(k) 5

6 Who May Be Excluded? Employees who: Have not reached age 21 Have not worked 1,000 hours in one year Nonresident aliens Union employees Employer flexibility: May lower year of service and/or age requirement 6 Page 6 RE

7 Funding Employer profit-sharing contributions: Maximum tax-deductible contribution is 25% of eligible payroll Salary deferrals. 100% of employee s compensation up to $17,500 Catch-up contributions. Additional $5,500 in salary deferrals for individuals age 50 and over Overall contribution limits for 2014 cannot exceed the lesser of 100% of compensation or $52,000, $57,500 if age 50 or over 7

8 Roth 401(k) Feature: Contributions Opportunity to save for retirement through Traditional 401(k) (pretax) and/or Roth 401(k) (after-tax) investing No income limits. Unlike a Roth IRA, participants may contribute to a Roth 401(k) regardless of how much they earn Salary deferral contributions only. Profit-sharing contributions are treated as Traditional (pretax) 401(k) contributions Single maximum 401(k) contribution limit for both Roth 401(k) and Traditional 401(k) contributions in 2014 $17,500 $5,500 additional catch up at age 50 Contributions may be split between Traditional 401(k) and Roth 401(k) contributions within these limits 8

9 Roth 401(k) Feature: Distributions Just like the Traditional 401(k), distributions from a Roth 401(k) are not permitted until the participant has experienced a triggering event such as death, disability, separation from service or attainment of age 59½ In order for the distributions to be tax-free, the participant in the Roth 401(k)account must have held the account for at least five years and experience a qualifying event Unlike the Roth IRA, required minimum distributions will apply to Roth 401(k) accounts 9

10 Comparing Plan Types Compensation SIMPLE IRA SEP IRA Profit-sharing/ Money Purchase Pension Single K $40,000 $13,200 $10,000 $10,000 $27,500 $80,000 14,400 20,000 20,000 37,500 $100,000 15,000 25,000 25,000 42,500 $140,000 16,200 35,000 35,000 52,000 Calculations are based for on an incorporated business making the maximum allowable tax deductible contribution of 25% and does not include catch-up contributions. 10

11 Defining Compensation Incorporated businesses W2 wages Unincorporated businesses Earned income (Net profits ½ Self-Employment Tax) / (1 + Profit-sharing contribution percentage) To calculate employee contributions for qualified plans, please refer to the worksheet found in IRS Publication 560 Retirement Plans for Small Businesses at 11

12 So When is a Single K plan a Good Option for You? Business owner wants To potentially maximize funding potential Access to funds through loans Hardship withdrawals available Business owners looking to expand their business can amend their existing plan to adopt a Traditional 401(k) SEP IRA or SIMPLE IRA plan is also another option 12

13 Administration No top-heavy testing No non-discrimination testing No IRA Form 5500 reporting required unless: Owner s parent s, children or grandchildren are employees Non-owner employees contribute to plan Combined plan assets of $250,000 Company is part of a controlled group 13

14 Plan Set-up/Funding Deadlines Plan Set-up: Must be established by the end of the plan year, usually December 31 st Salary deferral contributions are due as soon as administratively possible Employer profit-sharing contributions due by tax-filing deadline, including extensions 14

15 Vesting No vesting schedules Both employer contributions and employee deferrals are immediately 100% vested Vesting Schedules 15

16 Consolidation of Plan Assets Consolidation of retirement savings and can help reduce plan administration and expenses Rollover rules Rollovers and transfers are permitted from Traditional IRAs, SEP IRAs, SIMPLE IRAs (after two years), Qualified Plans, Traditional 403(b) and 457 Plans into a Traditional Single K Plan Conversions from a Traditional 401(k) or Traditional 403(b) to a Roth Single K plan are not permitted Rollovers from a Roth Single K Plan to a Roth 401(k) or Roth IRA are permitted Rollovers from a Roth Single K Plan to a Traditional IRA are not permitted nor are rollovers from a Roth IRA to a Roth 401(k) Check your prior plan for any restrictions and distribution rules Consult with your plan s financial advisor to evaluate your options 16

17 Loans/Hardship Withdrawals Hardship withdrawals permitted In-service distributions permitted Rollover dollars are eligible for distribution Loans permitted $75 set-up fee 17

18 Benefits of a Single K plan Higher contribution limit Simple to administer Full selection of Oppenheimer funds IVR and website access Loans Roth 401(k) feature available Annual participant account maintenance fee, $15. Other account fees and fund expenses may apply 18

19 Considerations No IRS Form 5500 reporting by OppenheimerFunds 19

20 Questions? Thank You! Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested. This material is provided for general and educational purposes only, and is not intended to provide legal, tax or investment advice, or for use to avoid penalties that may be imposed under U.S. federal tax laws. Contact your attorney or other advisor regarding your specific legal, investment or tax situation. Before investing in any of the Oppenheimer funds, investors should carefully consider a fund s investment objectives, risks, charges and expenses. Fund prospectuses and summary prospectuses contain this and other information about the funds, and may be obtained by asking your financial advisor, visiting oppenheimerfunds.com or calling CALL OPP ( ). Read prospectuses and summary prospectuses carefully before investing. 225 Liberty Street, New York, NY OppenheimerFunds Distributor, Inc. All rights reserved. RE March 31,