Does 1099 Income count toward SIMPLE Eligibility
A company sponsors a SIMPLE IRA and for 5 years has been paying someone 1099 income of more than $5,000 per year for their services; the person has been a contract employee.
Now the person has been hired as an employee and is being paid W-2 income this year.
Do the years of service as a 1099 contract worker count when determining SIMPLE eligibility? Or does only work done as a W-2 employee count towards eligibility?
Thanks!!
Permalink Submitted by Alan - IRA critic on Mon, 2017-09-18 16:24
Assuming that this person was properly treated as an independent contractor, they were not eligible to participate in the SIMPLE IRA plan, and may still not be eligible under the terms of the plan’s eligibility requirements for employees even though they are now an employee.