Simple IRA

A Savings Investment Match Plan for Employees (SIMPLE IRA) makes it easier for self-employed individuals and small businesses with 100 or fewer employees to offer tax-advantaged retirement plans.

Plan features

Tax advantages     


  • Employer contributions are deductible as business expenses.


  • Tax-deferred growth potential
  • Pretax contributions for participants



  • Must have 100 or fewer employees who earned at least $5,000 in the preceding year
  • Cannot maintain any other employer-sponsored retirement plan


  • Must have earned at least $5,000 from the employer in any two preceding years
  • Must be expected to earn at least $5,000 in the current year


Funded by employer contributions and elective employee salary deferrals

  • Plan Sponsors:
    • Mandatory 3% matching contribution or 2% non-elective contribution
  • Participants:
    • Up to 100% of compensation, with a maximum of $12,000 for 2013 ($14,500 if age 50 or older) and $12,000 for 2014 ($14,500 if age 50 or older)

Establishment deadline         

For current tax year: Set up and notify employees by October 1st

Administrative Responsibilities

Certain annual employee notifications must be made. No plan tax filings with the IRS are required


Minimum required distributions starting at age 70½

10% early withdrawal penalty (25% for first two years of plan participation) if under age 59½, subject to certain exceptions

Investment options             

A wide range of ‘no load’ mutual funds, stocks, bonds, ETFs, and FDIC-insured CDs

Support and guidance

One-on-one guidance along with research and tools to help you create a long-term plan and make investment selections for the plan

Note: Information deemed accurate but not guaranteed. All investing is subject to risk, including the possible loss of the money you invest.

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