SIMPLE IRA Employer Match (Self Employed)

Self Employed (Schedule C) client with one employee. The client has a SIMPLE plan and he matches 3%. He put in the max EE for himself ($16K, over the age of 50) in 2019. His net self-employment income for 2019 was $348,239. May I use that for calculating his 3% ER contribution ($10,447) or does the Section 401(a)(17) limit come into play limiting his ER contribution to $8,400 ($280,000 x 3%)?



The 401(a)(17) limit of 280k applies to 2% non elective contributions, but NOT to matching contributions. Therefore, you can use the full net SE income for the 3% match.

Thanks for the quick reply, Alan!

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