SIMPLE IRA

• Small business owners with up to 100 employees

Because this match plan allows for both employer and employee contributions, take advantage of the following benefits:

• Tax-deductible contributions as the employer
• Pre-tax contributions as the employee
• Tax-deferred growth potential on contributions

• 2022 Tax Year: Up to $14,000 in salary deferrals ($17,000 for those 50+)
• 2023 Tax Year: Up to $15,500 in salary deferrals ($19,000 for those 50+)

• Match employee contributions up to 3% (can reduce to 1% in any two of of five years) OR contribute 2% of employee's compensation (even if employee is not making deferral contributions)
• Contributions Worksheet for Employers

• Establish plan and notify employees by October 1 of the current tax year

• The employer contribution (match or non-elective) must be made by the employer's tax return date plus extensions (Tax return due date generally: April 15. Extension due date generally: October 15)

• Employee notification of  plan setup
• Employer must complete and retain Form 5305-SIMPLE or other plan documents in their records. Employees should receive a copy
• No plan tax filings with the IRS

• If you turned 70 1/2 prior to January 1, 2020: Minimum required distributions start at age 70 1/2
• If you turn 70 1/2 after January 1, 2020: Minimum required distributions start at age 73 (unless you turned 72 prior to January 1, 2023, then your RMD's must begin by 72)
• 10% early withdrawal penalty (25% for the first two year of plan participation) if under age 59 1/2 (exceptions may apply)

• Please refer to the IRS page on SIMPLE IRAs for additional details
• Review the SIMPLE IRA Guide for additional details