SIMPLE IRA
Owner has two businesses. One has 3 employees, the other business has two employees. Owner is 100% owner of each business.
Can we open a Simple IRA for each business, so all employees are eligible to participate in a Simple? As long as the owner stays within the IRS guidelines for maximum contributions (between the two Simple IRA’s) is this okay? The plan would be to have the owner utilize one Simple IRA and not utilize the other Simple IRA for his contributions.
Permalink Submitted by David Mertz on Fri, 2019-05-10 17:29
Because the owner is 100% owner of each business, these businesses are a controlled group that must be treated as a single employer for the purpose of a retirement plan. A single SIMPLE IRA would need to be opened covering both businesses. The owner’s contributions would be based on the combined income from both businesses.