SIMPLE IRA – startMid year Match

If a SIMPLE IRA begins mid year (say July 1) and the plan documents clearly state a July 1 start date. Does the employer calculate the match based on the Calendar Year income or only the income from the plan start date. I have a two to two tie on this with CPAs and third part administrators.

Ron Naumann ChFC



The match has to be based on the whole 12 month year’s compensation.
See Notice 98-4, Q and A D-4.
Also see IRC (p)(6)(A)(i) Definition of compensation
IRC 408(p)(6)(C) Definition of year



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