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Savings Incentive Plan For Employees (SIMPLE)
 
The Savings Incentive Match Plan For Employees is an employer-sponsored plan for companies with 100 or fewer employees.
 
  • Employees may make salary reduction contributions up to a maximum of $10,500 per year (indexed for inflation). *

  • All contributions are deductible to the employer.

  • The employee contribution amount can be changed or discontinued during the year.

  • The employer makes matching or nonelective annual contributions. **

  • Establishment of the plan and contributions are subject to special timing requirements.

  • All contributions are 100% vested immediately and can't be forfeited.

  • If funds are withdrawn prematurely, they may be subject to income tax, if the owner is under age 59˝, and a 10% premature distribution penalty. CD early withdrawal penalties may also apply.

* Age 50 bonus. If you reach age 50 during the calendar year, an additional catch-up contribution may be made to Traditional and Roth IRAs and SIMPLE. The catch-up does not apply to SEP, Profit Sharing or Money Purchase plans, Education Savings Account, or Rollovers. Ask your tax advisor for details.

** Your employer can either a) match your salary reduction contributions (dollar-for-dollar) up to 3% of your compensation; or b) under certain conditions, contribute 2% of your compensation earned with that employer during the year; or c) match your salary reduction contributions (up to 1% or more of your compensation) for any 2 of 5 years at that specified matching rate, subject to certain requirements. Contact your tax advisor for specific details about this plan.

 

Downey Savings does not provide legal, accounting or tax advice. Please consult with a qualified attorney, financial advisor, or tax advisor to understand how this information may apply to your own personal or business situation.

 
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