IRA type

Sep IRA and SIMPLE IRA are small business retirement plans, with SEP allowing only employer contributions and SIMPLE permitting both employer and employee contributions.

SEP IRAs allow employers to contribute up to 25% of pay, while SIMPLE IRAs require a 3% match or 2% contribution if employees don't contribute.

"A SEP is a Simplified Employee Pension.

• A SEP is a retirement savings plan established by an employer for their employees and themselves. 
  • It can also be established by self-employed individuals. 
  • Employers can make tax-deductible contributions on behalf of eligible employees to their SEP IRAs.
  • The SEP IRA contribution limit for 2024 is 
    • 25% of eligible employee compensation, up to $69,000. 
    • The maximum compensation that can be considered for contributions in 2024 is $345,000.
• You can see more on the IRS publication Simplified Employee Pension Plan (SEP)

A Simple plan to the Simple method to contribute toward employees' and their own retirement savings.

• The amount an employee contributes from their salary to a SIMPLE IRA cannot exceed 
  • $16,000 in 2024
• SIMPLE IRA rules: Contributions and limits
  • The company will make a non-elective contribution of at least 2 percent of compensation for all eligible employees earning at least $5,000.
  • Maximum compensation is $345,000 for the 2024 tax year.
  • Make a matching contribution of 100 percent up to the first 3 percent of compensation.
• You can see more on the IRS publication SIMPLE IRA Contribution Limits"

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