plan design after EGTRRA for very small employer

[Guest deathbycashcall]

Trying to figure out the best design for a business owner who makes $200,000, no employees other than spouse who takes $25,000. Would like to avoid establishing a K feature. Anyone remember the old 40% MPP's we used to set up to get around family aggregation rules? With that in mind, could we establish a simple standardized PSP...deductible limit would be 25% x $225,000 or $56,250. Business owner would receive $40,000 and spouse would receive $16,250. Am I missing something here? If this is do-able, is this the BEST design for this scenario?

[stephen]

This seems doable. I cannot think of a way to get them any more money into the plan without establishing a db plan.

[david rigby]

Do-able? Yes. Best design? That depends.

As Stephen as stated, you could get a larger contribution/deduction in a DB plan, but depends on a few factors, most importantly, the ages of the participants.