Plan Sponsor/Employer
	SIMPLE IRA Plan   A SIMPLE IRA plan is a Savings Incentive Match PLan for Employees. Because this is a simplified plan, the administrative costs should be lower than for other, more complex plans. Under a SIMPLE IRA plan, employees and employers make contributions to traditional Individual Retirement Arrangements (IRAs) set up for employees (including self-employed individuals), subject to certain limits. It is ideally suited as a start-up retirement savings plan for small employers who do not currently sponsor a retirement plan. To establish a SIMPLE IRA plan, you: Have a business with, generally, 100 or fewer employees. Need to complete just a form or two. Cannot have any other retirement plan. Advantages: Easy to set up and run – usually just a phone call to  Insurancepays Agents & Associates gets things started. Administrative costs are low. Employees can contribute, on a tax-deferred basis, through convenient payroll deductions. You can choose either to match the employee contributions of those who decide to participate or to contribute a fixed percentage of all eligible employees’ pay. Under a SIMPLE IRA plan, you, the employer, make contributions to traditional IRAs (SIMPLE IRAs) set up for each of your eligible employees. In addition, this type of plan allows your employees to defer a part of their salaries into the plan for retirement. A SIMPLE IRA Plan is funded both by employer and employee contributions. Each employee is always 100% vested in (or, has ownership of) all money in his or her SIMPLE IRA. How does a SIMPLE IRA plan work? Example 1: Elizabeth works for the Rockland Quarry Company, a small business with 50 employees. Rockland has decided to establish a SIMPLE IRA plan for its employees and will match its employees’ contributions dollar-for-dollar up to 3% of each employee’s salary. Under this option, if a Rockland employee does not contribute to his or her SIMPLE IRA, then that employee does not receive any matching employer contribution from Rockland. Elizabeth has a yearly salary of $50,000 and decides to contribute 5% of her salary to her SIMPLE IRA. Elizabeth’s yearly contribution is $2,500 (5% of $50,000). The Rockland matching contribution is $1,500 (3% of $50,000). Therefore, the total contribution to Elizabeth’s SIMPLE IRA that year is $4,000 (her $2,500 contribution plus the $1,500 contribution from Rockland). The financial institution partnering with Rockland on the SIMPLE IRA plan has several investment choices and Elizabeth is free to pick and choose which ones suit her best. Example 2: Austin works for the Skidmore Tire Company, a small business with 75 employees. Skidmore has decided to establish a SIMPLE IRA plan for all its employees and will make a 2% nonelective contribution for each of its employees. Under this option, even if a Skidmore employee does not contribute to his or her SIMPLE IRA, that employee would still receive an employer contribution to his or her SIMPLE IRA equal to 2% of salary. Austin has a yearly salary of $40,000 and has decided that this year, he simply cannot make a contribution to his SIMPLE IRA. Even though Austin does not make a contribution this year, Skidmore must make a contribution of $800 (2% of $40,000). The financial institution partnering with Skidmore on the SIMPLE IRA plan has several investment choices and Austin has the same investment options as the other plan participants.

"Simplest Retirement Arrangement an Employer Can Have with Employees"
	Payroll Deduction IRA   As an employer, you may want to consider offering your employees a Payroll Deduction IRA. Under a Payroll Deduction IRA, your employee establishes an IRA (either a Traditional IRA or a Roth IRA) using one of our Agents. The employee then authorizes a payroll deduction amount for the IRA. This is probably the simplest retirement arrangement that a business can have. It is so easy that, in fact, no plan document is needed under this arrangement. To establish a Payroll Deduction IRA, you: Can be a business of any size, even self-employed. Advantages: Easy to set up and operate. Administrative costs are low. Only your employees make contributions. Your responsibility as an employer is simply to transmit the employee’s authorized deduction to the financial institution. In general, if you offer this arrangement to any employee, then you should offer it to all employees. How does a Payroll Deduction IRA work? Rebecca, age 45, works for the Pasco Collection Company, which does not have an employer-sponsored pension plan. However, Pasco has offered its employees the opportunity to have deductions taken from their salaries (which are paid using electronic deposit) to contribute to IRAs that these employees have set up for themselves. Rebecca signs up for the program and has $100 per bi-weekly paycheck deposited into her IRA for a yearly total of $2,600 (which is below the $4,000 limit in 2005). Call 972-670-3102 or email us:  info@insurancepays.net