Fidelity's Savings Investment Match Plan for Employees (SIMPLE IRA) makes it easier for self-employed individuals and small businesses with 100 or fewer employees to offer tax-advantaged retirement plans. With Fidelity, you have no account fees and no minimums to open an account.
A SIMPLE IRA allows both the employee and the small business owner or sole proprietor to make contributions. ... A SEP-IRA, meanwhile, only allows business owners to make contributions for both themselves and their employees.
Go to Fidelity.com/openaccount or call 1-800-544-6666. Use this application to open a SIMPLE IRA. Do NOT use this form for Traditional, Rollover, Roth, SEP or Inherited IRAs, or to open a SIMPLE IRA for a minor or a ward. Type on screen or print out and fill in using CAPITAL letters and black ink.
A SIMPLE IRA is funded by:
Best Roth IRA accounts to open in May 2021:
The best-performing Fidelity funds for retirement:
Unlike a traditional 401(k) plan, SEP IRAs have little to no administrative overhead. Companies with only a single employee can take advantage of SEP IRAs, meaning they can be a good choice for solo entrepreneurs or gig workers. Most importantly, SEP IRAs offer more generous tax breaks than personal IRAs.
SIMPLE IRA plans can provide a significant source of income at retirement by allowing employers and employees to set aside money in retirement accounts. SIMPLE IRA plans do not have the start-up and operating costs of a conventional retirement plan.
Owners of small businesses have more choices today when it comes to saving for retirement. Those who have full-time employees can save for retirement using a SEP IRA, while solo practitioners can choose between that and a solo 401(k) plan that has higher contribution limits and other advantages.
Starting a SIMPLE IRA plan is easy to do! You'll need to choose a financial institution to serve as trustee of the SIMPLE IRAs to hold each employee's/participant's retirement plan assets. These accounts will receive the contributions you make to the plan.
Tax benefits — Employer contributions qualify as a tax-deductible business expense. Affordable cost — A $10 one-time setup fee and an annual $10 fee, both per participant.
Funds from a SIMPLE IRA can be rolled over into another SIMPLE IRA, a traditional IRA, or another qualified employer-sponsored plan like a 401(k). But as with a 401(k), you have to ensure that you follow the prescribed process for the rollover in order to avoid taxes or penalties on the asset transfer.
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