Qualified Plans
Which employer may set up a SIMPLE IRA plan?
Answer and explanation
Answer: D. IRS Publication 560 states that a SIMPLE IRA plan may be set up only where the employer had 100 or fewer employees who received $5,000 or more in compensation. The plan is not limited to sole proprietors, and the eligibility test is the employee count rather than the absence of any other plan.Source: IRS Publication 560 — Pub 560, SIMPLE eligibility
More qualified plans questions
- Which businesses may establish a qualified plan?
- Which of these does IRS guidance describe as qualified plans?
- Who contributes to a SEP, and where do the contributions go?
- Why does it matter to an employer whether a retirement plan is qualified?
- By when may an employer set up a SEP for a given year?
- How does IRS guidance classify a 401(k) plan?
621 New York questions like this one.
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