SIMPLE IRA

A SIMPLE IRA is a retirement plan designed for small employers to offer their employees.

In this case, the term “employee” includes a self-employed individual who receives earned income.

The Savings Incentive Match Plan for Employees (SIMPLE) IRA is a salary reduction arrangement wherein the employee elects to defer a percentage of compensation, before taxation, each pay period into a SIMPLE IRA. The employer then contributes the salary deferral, along with a matching amount, to the account on behalf of the employee. The contributions and earnings in these plans are not taxed until withdrawn.

A self-directed SIMPLE IRA allows you to invest your retirement funds in real estate, notes, mortgages and other assets you may choose to acquire.

Consider a self-directed SIMPLE IRA if:

  • You have a company with less than 100 employees.
  • You are looking for a plan with low start-up and administrative costs.
  • You want a plan that provides you and your employees with a simplified way to contribute toward retirement.
  • You need to reduce business taxes.
  • You want a plan that can help you attract and retain quality employees.
  • You want your employees to contribute through convenient payroll deductions.
  • You would like flexibility in how much to contribute to the employees’ plans.
  • You are looking for a wider range of investment choices including stocks, bonds, mutual funds, real estate, notes, LLCs, and more.
  • You are looking for a plan that is easy to set up and run – Advanta IRA handles most of the details.

The most common way to fund any retirement plan is by making a contribution to your account. You may also roll over or transfer funds from an existing employer plan, such as a 401(k), a pension plan or another SIMPLE IRA. If your current retirement account does not allow self-direction, you may also transfer those funds to an Advanta IRA account so you may choose your own investments.

Contribution Limits 2016 2017
SIMPLE IRA $12,500 (+ $3,000 if 50 and over) + up to 3% of employer match $12,500 (+ $3,000 if 50 and over) + up to 3% of employer match