SIMPLE


Also found in: Dictionary, Thesaurus, Medical, Legal, Acronyms, Idioms, Encyclopedia, Wikipedia.
Related to SIMPLE: simple sentence

Savings Incentive Match Plan for Employees of Small Employers

An IRA or 401(k) plan for employees of small businesses, usually with fewer than 100 employees. The employee may make tax deductible contributions, and the employer may contribute in one of two ways. The employer may either match employee contributions up to 3% of the employee's annual salary, or provide a contribution of 2% of the salary regardless of how much the employee contributes. The employee controls the investment of the contributions.

SIMPLE

A savings incentive match plan for employees that is similar to but more flexible than an IRA for businesses with 100 or fewer employees. Employees enter into a qualified salary reduction agreement to contribute a percentage of their annual compensation to a tax-deferred retirement account.

SIMPLE.

A SIMPLE, also known as a SIMPLE IRA, is short for Savings Incentive Match Plans for Employees, an employer sponsored retirement savings plan that may be offered by companies with fewer than 100 employees.

Employers must contribute to eligible employees' accounts each year in one of two ways. They can make a contribution equal to 2% of salary for every employee, or match dollar-for-dollar each employee's contribution to the plan, up to 3% of that employee's annual salary.

A SIMPLE may be set up by establishing an IRA in each employee's name or as a 401(k). Congress sets an annual dollar limit on the tax-deferred amount an employee may contribute, based on the type of SIMPLE it is. Contribution ceilings for SIMPLE-IRAs are lower than for other employer sponsored plans.

You may withdraw assets from a SIMPLE without penalty if you are 59 1/2 or older and retired. And you must begin taking minimum required distributions by April 1 of the year following the year you turn 70 1/2 unless you're still working. Taxes are due on distributions at your regular tax rate.

You may roll your assets over into another employer plan or an IRA if you leave your job for any reason or retire.

Two key differences between SIMPLEs and other employer plans are that your account must be open at least two years before you can withdraw or move the money, and the federal tax penalty for early withdrawal is 25% of the amount you take, rather than 10%.

References in periodicals archive ?
Simple Truth continued to grow in popularity the same quarter, with sales growing 19 percent.
Richard defers the maximum $15,500 of his salary to his SIMPLE IRA.
Simple will continue to operate separately under the same brand, with the same philosophy and approach to customer experience.
Spanning more than 30 categories, Simple Truth and Simple Truth Organic products provide much of the U.
The CRM API is available now, at no extra charge to existing Really Simple Systems customers.
In addition, Simple said it was also seeking an ambitious teen to serve as the "Simple OfficialVideo Blogger" and occupy a seat on the Simple junior board of skin care advisors.
4 : not complex or fancy <She wore simple clothing.
Photo by Anna Williams from ``Real Simple Meals Made Easy,'' Time, Inc.
Simple Remote Real Estate Software is designed to manage data simply and efficiently.
Making the simple complicated is commonplace; making the complicated simple, awesomely simple, that's creativity.
The classic tools are all simple ones that can be moved by slight muscular movements, often unrealized by the practitioner or observers.
The basic idea is to provide an environment in which the student or teacher has a relatively simple improvisatory role and, therefore, a great opportunity for a fun and successful experience.