Keogh Plan

A Keogh plan is a retirement plan for self-employed individuals and unincorporated businesses, and their employees. A Keogh plan is a qualified retirement plan, meaning that it qualifies for tax benefitsin the case of the Keogh plan, tax deferral until age 59. The individual is required to take distributions from the Keogh plan at age 70. The maximum amount that can be contributed generally changes each year. A person who is employed but who also receives self-employment income is eligible to open up a Keogh plan. The IRS requires that employees under a Keogh plan be at least 21, be full-time, and have worked for at least one year. A Keogh plan may be a defined benefit plan or a defined contribution plan.