A 412(e)(3) plan is a fully insured defined benefit plan. This retirement plan is suitable for the small business owner for a variety of reasons. This plan will often provide a much greater tax reduction when compared to more traditional retirement plans. The result: lowers your AGI and you keep more of your money. This type of plan may also provide you with more certainty and benefits for your and/or your employees that may not be offered in other plans, which may offer only tax deductibility.