Keogh Plan (HR-10)
What Does Keogh Plan (HR-10) Mean?
A Keogh Plan, also known as an HR-10, is a retirement plan designed for small business owners, sole proprietors, and self-employed individuals. It is named after New York Congressman Eugene Keogh, who was instrumental in passing the legislation for this plan in 1962.
Insuranceopedia Explains Keogh Plan (HR-10)
An HR-10 plan can be either a defined benefit plan or a defined contribution plan. A defined benefit plan specifies the amount of money a person will receive at retirement, based on factors such as salary and length of employment. A defined contribution plan, on the other hand, determines the amount of money to be contributed to the retirement plan, without guaranteeing a specific payout at retirement.
The HR-10 plan is well-known for its high contribution limits compared to other retirement plans. As of 2014, the contribution cap was $52,000. However, one drawback of this plan is that setting it up can be more expensive and involve more paperwork than other retirement plans.
