SIMPLE Retirement Plans for small business

In addition to the SEP, small business owners can establish Savings Incentive Match Plans for empLoyees of small Employers, or SIMPLE Plans, to help themselves and their employees save for retirement. Despite the name, these plans are less simple than the SEP, in that they allow employees themselves to contribute to their own retirement accounts, in addition to the employer.

SECURE 2.0 UPDATE: Both Employer and employee contributions to a SIMPLE IRA can now be made to Roth accounts.

0:00 Introduction
0:42 What are SIMPLE plans?
2:22 How do SIMPLE plans work?
3:48 A SIMPLE example
6:55 How SIMPLEs are reported on the tax return
7:45 Conclusion

Much of the information from the SEP video applies to SIMPLE plans as well. For more information on SEPs, click here:    • A beginner's guide to Simplified Empl...  

For the details of Form W-2, click here:    • What are all those numbers on my W2?  

Resources and Additional Information:

IRS Publication 560: "Retirement Plans for Small Businesses": https://www.irs.gov/pub/irs-pdf/p560.pdf

IRS Form 5305-SIMPLE: "Savings Incentive March Plan for Employees of Small Employers (SIMPLE)--for Use With a Designated Financial Institution": https://www.irs.gov/pub/irs-pdf/f5305...

IRS Schedule C (Form 1040): "Profit or Loss from Business": https://www.irs.gov/pub/irs-pdf/f1040...

IRS Form W-2: "Wage and Tax Statement": https://www.irs.gov/pub/irs-pdf/fw2.pdf

Investopedia: "What Is a Savings Incentive Match Plan for Employees of Small Employers (SIMPLE)?": https://www.investopedia.com/terms/s/...

Nerdwallet: "What Is A SIMPLE IRA Plan?": https://www.nerdwallet.com/article/in...

The Tax Geek on the Site Formerly Known as Twitter: @taxgeekusa

The Tax Geek on Reddit: www.reddit.com/r/askataxgeek

Image and footage credits:

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Intro Music: "Bluesy Vibes" - Doug Maxwell - YouTube Creator Music

Outro Music: "Modern Attempt" - Track Tribe under license from YouTube Creator Music

DISCLAIMER: This video is for educational and informational purposes only. It is not intended to render tax advice or financial advice for individual situations. If you have questions regarding your particular situation, please consult with a qualified tax or financial professional.