An employer that offers a qualified retirement plan to its employees is eligible to:

• A. Exclude retirement plan expenses from financial statements
• B. Receive tax deductions for contributions made to the plan
• C. Defer reporting employee compensation indefinitely
• D. Avoid all payroll taxes on employee wages

Answer: (B)

Verified step by step guidance

1. Understand the concept of a qualified retirement plan: A qualified retirement plan is a type of employer-sponsored retirement plan that meets specific requirements set by the IRS, allowing employers to receive tax benefits for contributions made to the plan.
2. Analyze the options provided in the problem: Carefully review each option to determine which aligns with the benefits of offering a qualified retirement plan.
3. Evaluate the tax implications: Employers offering qualified retirement plans are eligible for tax deductions on contributions made to the plan, as these contributions are considered a business expense.
4. Clarify the incorrect options: Excluding retirement plan expenses from financial statements is not allowed under accounting standards, deferring reporting employee compensation indefinitely is not permissible, and payroll taxes on employee wages cannot be entirely avoided.
5. Conclude the correct answer: Based on the analysis, the correct benefit for employers offering a qualified retirement plan is the ability to receive tax deductions for contributions made to the plan.