Employers maintain the greatest flexibility in contribution amounts to a qualified retirement plan by adopting a:

A profit-sharing plan offers employers the greatest flexibility in contribution amounts to a qualified retirement plan. In this type of plan, employers can make discretionary contributions based on their profitability or financial situation for the year. This means that contributions can vary from year to year, allowing companies to adjust their funding according to their current financial conditions.

Unlike defined benefit and money purchase pension plans, which have fixed contribution structures and require the employer to meet specific funding obligations annually, a profit-sharing plan provides a more adaptable approach. This flexibility allows employers to respond to changes in their business environment, ensuring that contribution levels are aligned with their overall financial strategy.

While a target benefit plan does provide some level of flexibility, it typically involves a predetermined benefit target that must be funded appropriately, which can reduce the level of discretionary funding compared to a profit-sharing plan. Thus, the profit-sharing plan is the most suitable option for employers seeking maximum flexibility in contributions.