IRS Posts 2005 Form for Claiming Plan Startup Credit

December 19, 2005 – The IRS has posted the 2005 tax year Form 8881, Credit for Small Employer Pension Plan Startup Costs. This form is used by employers (when filing their business tax return) to claim credit for costs associated with retirement plan startup. The credit is available for three years.  Only employers who had no more than 100 employees earning $5,000 or more during the year preceding the first credit year may claim the credit. Eligible employers may claim a 50 percent credit on expenses up to $1,000 (maximum of $500 credit) for each eligible credit year.

Form 8881 may be accessed at http://www.irs.gov/pub/irs-pdf/f8881.pdf.