Click to expand for more information on SIMPLE and SEP IRAs.

 

What is a SIMPLE IRA?

Less expensive and less complicated than the traditional 401(k) plan, SIMPLE is an acronym for Savings Incentive Match Plan for Employees. Employers are generally required to match anywhere from 1 percent to 3 percent of the employee’s salary. Employees can contribute to their account through regular payroll deductions, receiving a tax deduction.


The role of a SIMPLE IRA in your plan

Money grows tax-deferred until distributions taken at retirement so that savings can compound more quickly.


Is a SIMPLE IRA for you?

This makes a great start-up retirement savings plan for small employers not currently sponsoring a retirement plan.


Stat

With a SIMPLE IRA, the employer matching incentive is built into the plan. The employer must either match the contributions employees make to their plan, up to 3% of salary. Or the employer can make contributions for employees of a flat 2% of salary, whether or not the employee chooses to participate in the plan.

What is a SEP IRA?

Designed for small business owners and self-employed individuals, a SEP IRA allows you to put away the lesser of 25% of your compensation or up to $57,000 (for 2020).


The role of a SEP IRA in your plan

A SEP IRA is a traditional IRA and follows the same investment, distribution and rollover rules as traditional IRAs.


Is a SEP IRA for you?

In addition to their high contribution limit, these plans are easy to set up and administer.


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You can set up a SEP for your self-employed business even if you participate in your employer’s plan at a second job. A SEP IRA can be created and funded up until the tax filing deadline for the previous year.
 
 
 
 
 
 


Why United Wealth Management

A positive impact on your employees is a positive impact on your business. We’ll go over all the details, including eligibility and benefit rules, and then guide you in setting up this retirement plan
 

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