This volume covers recent legislative and regulatory developments in simplified employee pension
(SEP) plans and savings incentive match plans for employees (SIMPLEs).
Other kinds of plans offered were Simple IRAs (9%), Simplified Employee Pension
IRAs (8%), defined-benefit plans (4%), nonqualified supplemental executive plans (2%) and Keogh plans (1%).
Simplified Employee Pension
Plans offer an uncomplicated alternative to traditional pension plans.
If you're self-employed (this includes employees who free-lance on the side), you can start a Simplified Employee Pension
, also known as SEP-IRA, and contribute 13 percent of your net 1997 self-employment earnings.
That includes any money in simplified employee pension
(SEP)-IRAs or SIMPLE IRAs.
What requirements must be met if a simplified employee pension
is offered on a cash or deferred basis?
A Simplified Employee Pension
IRA allows an employer--or in Jacqueline's case, a self-employed person--to contribute up to 25% of their compensation or $40,000--whichever is less--into an investment account for retirement.
Neither ERISA nor IRC protections apply to assets held under individual retirement arrangements, simplified employee pension
plans, government plans, or most church plans [ERISA sections 4(b) and 201; IRC section 401(a) and DOL Regulations section 2510.
If you didn't max out your retirement plan contributions in 1999, you still can make 1999 contributions to an individual retirement account (IRA), simplified employee pension
(SEP), and Keogh as late as your tax-filing date plus extensions.
Hartley also has a Simplified Employee Pension
plan, a tax-deferred retirement account for small-business owners, analogous to a 401(k).
This benefit, which has an additional annual charge, is only available within a Traditional, Roth, Simplified Employee Pension
or Custodial IRA.
The choices include 401(k), profit sharing, defined benefit, and simplified employee pension