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Taxes stink. Ah, but as citizens of this wonderful country we must pay our dues for services. Most business owners know that the more you make the more you are taxed.

The best way to reduce your taxable income and greatly benefit yourself at the same time is through retirement funds, such as a 401(k) plan. I recently started a Solo 401(k) for myself and can place up to $44,000 a year into it, reducing my taxable income by this amount each year.

Your 401(k) can mean the difference between paying the government or creating a future for you and your family.

How should a 401k be balanced?

Money magazine suggests these allocations:

1) Aggressive–for those with 35 or more years until retirement

50%–large cap stocks
15%–mid cap stocks
15%–bonds
10%–small cap stocks
10%–international stocks

2) Moderate–for those with 20 years until retirement

35%–large cap stocks
35%–bonds
10%–mid cap stocks
10%–small cap stocks
10%–international stocks

3) Conservative–for those within 10 years of retirement

40%–bonds
30%–large cap stocks
10%–mid cap stocks
10%–international stocks
10%–cash

Read more about 401(k) plans:

• Forbes.com – A Way To Max Your Tax Savings
• U.S. Dept. of Labor – 401(k) Plans For Small Businesses
• About.com – Maximizing Your 401k Plan
• SmartMoney.com – The Solo 401(k)