Small Business Builder: Good Retirement Plans

ERISA requires all retirement plans to operate for the "exclusive benefit" of participants and their beneficiaries. Thus, plan sponsors must know and understand investment laws and principles, devote ample time and attention to administering the plan, prudently diversify plan investments and avoid conflicts of interest in investment decisions.

2001 Tax Reminders

Income-tax deadline. The federal filing deadline for calendar-year taxpayers is April 15, 2002.

Business mileage. The standard rate for operating your business vehicle (car, van, pickup or panel truck) has been raised to 34-1/2 cents per business mile.

Capital gains. The 10 percent capital-gain rate has been reduced to 8 percent for "qualified five-year gains."

Section 179 equipment. You can now expense (rather than depreciate) up to $24,000 for new equipment put in service during 2001 (up from $20,000 in 2000). There are certain restrictions. The equipment must be used for business more than half the time, for example, and only $3,060 of the cost of a business auto is eligible for the deduction.

Health-insurance deduction. If you're self-employed, you can deduct 60 percent of your 2001 health-insurance expense on the front of Form 1040 — even if you don't itemize deductions or otherwise qualify for the medical deduction. The deductible amount will rise to 70 percent next year.

Disaster relief. If your business — regardless of location — was directly affected by the Sept. 11 terrorist attacks, you might be able to postpone "certain tax deadlines," according to the IRS. To find out of you qualify for postponements, or for answers to other questions related to Sept. 11, e-mail corp.disaster.relief@irs.gov.

Free advice that's worth something. Order up to five free copies of Small Business Guide, CD-ROM 2002 from the IRS. You can request your copies online at http://apps.irs.gov/prod/bus_info/sm_bus/smbus-cd.html or by phone at 800-829-3676. Ask for IRS Publication 3207.