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SIMPLE IRA

SIMPLE IRA plans for employees with an employer match option

A SIMPLE IRA is a retirement plan for small businesses that offers your employees a salary-deferral contribution feature along with a matching employer contribution. Consider a SIMPLE IRA if your small business has steady income and your employees want to make contributions to a retirement plan.

When you choose to invest for the future at TD Ameritrade, you will not be charged administrative or account maintenance fees.** You also get access to a breadth of investment choices, and guidance from our team of Investment and Retirement Consultants.

Speak with a Retirement Consultant to get started today at 800.472.0586.

Open and fund an IRA and get up to $600.

Open new account

 

Best For:

  • Small business owners with up to 100 employees 

Tax Benefits:

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

Employee Contribution Limits:

  • Up to $12,500 in salary deferrals ($15,500 for those 50+)

Employer Contribution Limits:

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

Date Account Must Be Opened By:

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

Funding Deadline:

  • 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)

Administrative Responsibilities:

  • 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

Withdrawals:

  • Minimum required distributions start at age 70½
  • 10% early withdrawal penalty (25% for first two years of plan participation) if under age 59½ (exceptions may apply)

Further Details:

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

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