Definition - What does Keogh Plan mean?
A Keogh plan is a retirement option for small, unincorporated businesses or the self-employed.
Typically referred to as a “qualified plan” by the Internal Revenue Service, Keogh plans help small businesses and self-employed individuals create tax-deferred pension plans by allowing them to set aside a certain percentage of their income as tax deductible.
Justipedia explains Keogh Plan
Recognizing the difficulties that self-employed individuals or people working in unincorporated businesses face in trying to save money for retirement, Congress passed legislation creating the Keogh plan in 1962.
While the government and corporations possess the financial power to offer employees pension plans for retirement, Keogh plans help the self-employed and small businesses pool their money to create effective pensions.
Keogh plans are named after New York Congressman Eugene James Keogh, who originally sponsored the legislation that created the plans.