Korean Job Discussion Forums

[quercus]

hey,

for starters, yes i know i can save tax free to a certain amount. i have done that and am squared away with that stuff. but i want to tax shelter additional cash specifically for retirment purposes.

why not right? what do you think of this plan under the new sole401k guidelines? what problems would i have, legally, and how could i solve them? advice much appreciated, bust away:

http://www.entrepreneur.com/worklife/personalfinance/retirementplanning/article79286.html

this site details the new rules in america for the sole 401k. as a sole proprietor of a business you can stash away USD$ 14,000 a year plus 20% of your salary. an LLC 25%. sweet. that beats the hell out of a Roth IRA and the measly $5000 limit.

the place i have found catering to this type of stuff is a subsidiary of ING Direct, those online savings account people. i would rather go vanguard, and maybe i can, but they offer this which gave me the idea:

- http://www.sharebuilder401k.com/saving-for-retirement.htm

BUT, the questions:

looking at starting my own company (LLC, sole proprietorship) to try and come up with a plan to shelter some retirement money from taxes under the new sole401k program.

i would have to pay US taxes, but i could also deduct what i contribute to the 401k from my salary. but i dont know if i want to do a sole-proprietorship or a limitted liability corporation or another kind of small business. do you know anyone who advises on this kind of stuff?

a sole-proprietor seems to have total liability, but i am not taking out any loans for my business, i would just act as a consultant, or contractor of english teaching. i would not be doing anykind of work that could result in injury. some of the other business entity types offer protection from liability, the LLC higher 401k contribution rates and maybe some additional tax savings.

also i am wondering about tax dates, how long it takes to file for and officially open a company AND if i did it soon, could i claim on behalf of last year as well. is a sole-proprietorship much faster than a LLC, which would be more beneficial in this case?

also, since i am hoping to only be here two more years, what happens to my 401k after my business closes? can i stick it into my roth IRA, rollover my 401k to vanguard, or let it continue to operate until i create another business in america later?

can i legally say i am just working as a "private contractor" here if i pay my taxes? i wouldnt be a lie. i teach at a public elementary school, i just also happen to have my own company i file my salary under on the American side. so i am happy to pay my 3.3% Ktaxes and be on the up and up here in Korea. but i want to be able to shelter some of it back in the US for later.

i recognize i would be paying double taxes (maybe i could deduct on the america side later on??) but it seems it would definetly be worth it to let it all grow tax deferred in some index funds or etf funds for 20 or 30 years.

here is what i am reading:

- http://www.smallbizarticles.com/cgi-bin/articles/article_finder_html.cgi?ID=122&title=Business%20Structure%20and%20Entity%20Comparison%20Tables&query=122-entitycompare.html&keyword=incorporate

- http://www.entrepreneur.com/worklife/personalfinance/retirementplanning/article79286.html

- http://www.entrepreneur.com/worklife/personalfinance/retirementplanning/article79286.html

- http://www.sharebuilder401k.com/saving-for-retirement.htm

thanks for any comments and advice. any additional links to small businesses, getting started/filing, etc would be greatly appreciated.

[Riddle]

I'm also interested in this topic. I'm currently maxing out my Roth IRA and would like to find a tax shelter for additional savings. I'll read up more on the subject and post again if I find anything out.