Build Your Own Pension in Denver: the rules, the tax, and the next step
Build Your Own Pension here is a professional services and tech problem shaped by Front Range housing wealth plus Colorado’s flat state tax on federal taxable income, so a conversion is state-taxable in the same year it is federally taxable — not a national brochure.
Building your own pension is funding a floor, then a plan
If the job is a paycheck you cannot outlive, part of the work is an income annuity or a conservative bond ladder later — that is the pension-like piece. If the job is sheltering profit now, the work is a qualified plan with this year’s IRS limits. Do both in the right order: the plan while profits are high, the paycheck when you stop working.
Required contributions, actuarial fees, and testing are the price of a cash-balance design. Flexibility is the price of a SEP. Write the profit forecast for three years before you sign the bigger document.
The local stack this page is actually about
Front Range housing plus professional-services and tech W-2s make a conversion state-taxable in the same year it is federally taxable — Colorado flat tax applies to federal taxable income. PERA or other public pensions in the same household are a second ordinary-income stream. Health First Colorado is the Medicaid name; it is not Medicare. A home-sale year stacked with a convert-it-all IRA move is the usual Front Range overshoot. Write the IRMAA-and-state-tax sheet before the listing closes. Checkable names on this page: Health First Colorado (Medicaid), CO LIC. 8787626. For private pension planning, start from professional services and tech and healthcare and government — Front Range housing wealth plus Colorado’s flat state tax on federal taxable income, so a conversion is state-taxable in the same year it is federally taxable — rather than a national template.
Industry mix and the planning load
PERA and other public pensions, UCHealth and HealthONE hospital 403b plans, downtown professional-services bonuses, and Front Range home-sale years set the mix. A listing that closes in the same year as a conversion is the usual overshoot. Health First Colorado is the Medicaid name. This is a tech-and-services corridor, not a space-command installation. professional services and tech and healthcare and government are the two pay-and-savings stacks we actually see. Population context: about 715,000 residents (U.S. Census Bureau, ACS 2023 5-year estimates). The constraint we plan around is Front Range housing wealth plus Colorado’s flat state tax on federal taxable income, so a conversion is state-taxable in the same year it is federally taxable. Competition among advisors is high; that does not create a storefront and it does not change the statutes.
Qualified-plan choice for professional services and tech owners
Owners whose profit sits in professional services and tech need a document that matches the profit pattern: SEP, solo 401(k), or cash-balance. Front Range housing wealth plus Colorado’s flat state tax on federal taxable income, so a conversion is state-taxable in the same year it is federally taxable Adoption deadlines are earlier than a March surprise. Colorado taxes individual income at a flat state rate (currently 4.40% for tax year 2024, Colorado Department of Revenue) on federal taxable income with state modifications. Advisor and product density is high, so the scarce thing is a written recommendation that survives a second set of eyes — not another seminar.
Required contributions vs healthcare and government lumpiness
healthcare and government cash flow that is lumpy is a poor fit for a cash-balance required contribution. A seminar nickname (“private pension”) is not an IRS plan. Name the document and the three-year profit forecast before you sign.
What is different in Denver
ZIP codes 80202, 80219 is in the service area. Private Pension Planning work here is usually about Front Range housing wealth plus Colorado’s flat state tax on federal taxable income, so a conversion is state-taxable in the same year it is federally taxable — not a generic “retirement tips” article. Price conversions at the federal bracket plus Colorado’s published flat rate for that tax year, and keep Health First Colorado rules off to the side unless care is a live issue. Advisor density is high, so the scarce thing is a written recommendation that survives a second set of eyes.
How Colorado changes the numbers
Colorado starts from federal taxable income and applies a flat state rate (4.
Match the plan to the profit
A SEP is simple and scales with net earnings.
Adoption deadlines are earlier than people think
A solo 401(k) generally has to exist by the end of the tax year you want to defer employee money.
A pension alternative that is just an expensive annuity
Buying a high-commission contract and calling it a pension does not create the ERISA or IRS plan you think you opened.
Care, Medicaid, and the long stay
Health First Colorado is the Medicaid program.
How we actually work with you
Reduced Risk is a licensed service-area practice (CO LIC. 8787626). We work with Denver households by phone and secure video. There is no Denver branch office — and we will not invent one in schema or on the page.