Simple IRA Participation

What are the participation limitations that can be imposed by an employer. OR… Can an employer exclude a full time employee for 2 years?



The employer can exclude an employee if they have earned less than $5,000 in each of the two previous calendar years.



[quote=”herb.montgomeryfinancial@”]The employer can exclude an employee if they have earned less than $5,000 in each of the two previous calendar years.[/quote]

Some minor rewording… The employer must include employees who received at least $5,000 in compensation from the employer during [u][b]any [/b][/u]two preceding years and who are reasonably expected to receive at least $5,000 in compensation during the calendar year .

Employees who do not meet this requirement can be excluded.

Certain nonresident aliens and employees covered under a collective bargaining agreement can also be excluded.



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