2021 Financial Planning Cheat Sheet
SIMPLE IRA matching can be confusing. This video will explain how SIMPLE IRA matching works for employees and employers. SIMPLE IRA plans can be a great way for a small company to provide a low cost retirement benefit as an alternative to a qualified retirement plan like a 401(k) and profit sharing plan. SIMPLE IRA stands for Savings Incentive Match Plan for Employees. However, calling it simple is probably a misnomer.
⚠ Please don’t take this video as specific advice for your specific situation. Consult your own tax, legal and investment advisors. 👍
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super helpful
Thank you. Great video, explained in a way that was easy to understand.
Thank you
Very helpful, thank you!
Helpful!
Very helpful! I just spent 4 hours trying to find this answer by calling Vanguard and IRS…clueless
Nice presentation! It’s hard to find any information on this plan.
Do all the same rules apply when you are your own employee? I can contribute up to the max from the employee side plus 3% of compensation from the employer side?
I'm a small business owner with 2 full time employees, husband and wife, and 4 part time employees. I opened a simple IRA plan 9/15/2020. If my husband’s annual salary is $100,000, can he deposit full $13,500 maximum contributions for 2020 at one time in December and employer matching another 3% ($3000) in December?
Or he can only deposit from his paycheck bi-weekly and have the employer matching bi-weekly?
My goal is to put the maximum contribution. How can I do that? Your help is greatly appreciated.
Thank you! What if my salary fluctuates? How do they decide what 3% is? Do they look at the previous year, last few months? Great video!
how is this different from a 401k
My employer set up a simple IRA since Jan 2016. He contributed 3% for only one year. I have been contributing up to now and she never match for the past three years. I am planning to resign and is there a way that I will get the past matching?
What if an employee is part of profit sharing. The profit sharing is calculated at the end of the year. Once profit sharing is disbursed, the employees total compensation includes that profit sharing correct? Now the 2% match has to be adjusted to include the profit sharing. Once the 2% is contributed the Simple IRA, the profits have to be adjusted and the amount of profit sharing to the employee is also adjusted. See how this is an iterative and circular issue? How is something like this handled?
Very clearly explained man…broken down like a shotgun
In an elective plan, does the employer have the option to exceed the 3% match or to provide the match at any level even if the employee does not contribute?
Thank you very much. Clear and concise. Great presentation.
Great explanation David! The non-elective vs. elective match is a topic that has confused me in the past (and that's what I use for my practice!). I'll share this with some of my CPA friends.