|Who is eligible||
Employers must have 100 or fewer employees and cannot maintain any other employer sponsored retirement plan. Employees must have earned at least $5,000 from the employer in any 2 preceding years and expected to earn at least $5,000 in the current year.
Earnings are tax-deferred and contributions are tax-deductible.
Funded by employer contributions. Employers can contribute online through Fidelity PlanManager.
10% early withdrawal penalty (25% for first 2 years of plan participation) if under age 59½, subject to certain exceptions. Required minimum distributions starting at age 72.
A wide range of mutual funds, stocks, bonds, ETFs, and FDIC-insured CDs
Only certain fund families have mutual funds that are eligible investments for SIMPLE IRAs with no minimum initial investment requirement.
No account fees and no minimum to open an account.1 $0 commission for online US stocks and ETFs.*
Certain annual employee notifications must be made. No plan tax filings with the IRS are required.
For current tax year: Set up and notify employees by October 1. Deferrals and matching must be contributed within 30 days after the end of the month in which amounts would have otherwise been payable to the employee.
Matching contributions are due no later than the due date for filing your business's income tax return including extension.
|How to make
Employers can contribute online through Fidelity PlanManager.
2. Open your plan
- Print, read, and retain copies of the following documents:
- In order to set up your plan, you will need to print, complete and sign the following documents:
- Please mail the completed originals in Step 2 to:
PO Box 770001
Cincinnati, OH 45277-0038
- Keep copies of all forms and documents for your company's plan records.
- Once we have received the completed required documents in Step 2, you are ready to enroll your employees. Please see Enroll Employees for more information.
3. Enroll employees
- If you intend to deliver plan-related materials to your employees via email, please consult the Department of Labor's guidance for the use of electronic delivery of required plan-related materials.
- Download, print, customize, and distribute to all eligible employees:
- Fidelity SIMPLE IRA Plan Summary Description (PDF)
- Fidelity SIMPLE IRA Plan Participant Notice (PDF)
You are required to provide eligible employees with the Sample Summary Description and Participant Notice on an annual basis (by November 1). Fidelity SIMPLE IRA Plans receive a Summary Description and Participant Notice when the plan is established and annually thereafter in September.
You are legally required to give all eligible employees at least 60 days to make or modify any salary reductions elections each year.
- Have every participating employee print and review the SIMPLE IRA Employee Enrollment Brochure (PDF)
- Have every participating employee open a SIMPLE IRA account. For anyone choosing to open his or her account with Fidelity, visit Fidelity.com/simpleiraapplication.
- Have every participating employee complete a Salary Reduction Agreement (PDF) and forward the completed agreement to your payroll vendor or payroll processor. The employer should keep a copy of the employee's elections on file for their records.
If you have any questions, call 800-544-5373 to speak with a Fidelity small business retirement plan associate.
4. Funding your plan
Once you have opened your SIMPLE IRA Plan and employee accounts have been established, the next step is to set up electronic funding for the plan. You have two options:
Option 1: Use Fidelity's Electronic Funding Service, which is available through our Plan Manager site:
- For more information on Fidelity Plan Manager, please visit the FAQs
Option 2: Use your external bank or payroll vendor to fund your plan electronically:
Print, review, and provide your bank or payroll vendor with a copy of the Important Information about Your Fidelity SIMPLE IRA Plan (PDF).
What are the eligibility requirements for opening a SIMPLE IRA plan? Which employers can establish a SIMPLE IRA plan?
Generally, SIMPLE IRA plans can be established by any business with 100 or fewer employees who earned $5,000 or more in the preceding year, and which does not currently maintain any other retirement plan.
How do I open a SIMPLE IRA plan for my business? What about opening participant accounts?
Easy-to-follow instructions can be found online—see Open your plan. under the Plan Details tab.
Fidelity will mail employee enrollment kits to you upon receipt of the plan documents. Additional enrollment kits may be ordered from a Fidelity retirement representative by calling 800-544-5373.
When must my employees be notified of their eligibility to participate in the plan?
You are required to provide eligible employees with a Sample Summary Description and Participant Notice on an annual basis (by November 1). Fidelity SIMPLE IRA plans receive a Summary Description and Participant Notice when the plan is established and annually thereafter in September.
To open a SIMPLE IRA plan for the current year, the plan must be established and employees notified by October 1; please note that an exception applies for businesses established after October 1.
How is the salary deferral process managed and who gets the paperwork?
Your employees complete the Salary Reduction Agreement Form and return it to you or your payroll office (it does not go to Fidelity). A sample salary reduction agreement form is available online and is included in the Fidelity SIMPLE IRA employee enrollment kit. You may use this form or create your own customized version.
What mutual funds are eligible for investment in a SIMPLE IRA?
Your SIMPLE IRA account may buy or exchange any fund as long as the minimum initial and subsequent investment limits are met. To be eligible for ongoing SIMPLE IRA salary deferrals or employer contributions, however, a fund must waive the investment minimums for SIMPLE IRA customers.
How do I get a copy of my Adoption Agreement, Summary Description, or a Plan Level Report?
For copies of your Plan Adoption Agreement or additional Summary Descriptions, please call a retirement representative at 800-544-5373. The Summary Description is mailed to plans annually in September. Plan Level Reports are sent on a monthly basis to every SIMPLE IRA plan. The report includes a total of all salary deferral and employer contributions made for the period, is broken out by participants, and includes a participant level breakout of contributions.
My business is growing. Am I still eligible for a SIMPLE IRA plan?
Generally speaking, you are eligible for a SIMPLE IRA as long as your business has fewer than 100 employees earning $5,000 or more in the preceding year. As you grow, other retirement plans may become more appropriate. Please contact a Fidelity retirement representative at 800-544-5373 for more information.
- How can I make contributions to my SIMPLE IRA?
$0.00 commission applies to online U.S. equity trades and exchange-traded funds (ETFs) in a Fidelity retail account only for Fidelity Brokerage Services LLC retail clients. Sell orders are subject to an activity assessment fee (from $0.01 to $0.03 per $1,000 of principal). Other exclusions and conditions may apply. See Fidelity.com/commissions for details. Employee equity compensation transactions and accounts managed by advisors or intermediaries through Fidelity Institutional® are subject to different commission schedules.
1. No account fees or minimums to open Fidelity retail IRA accounts. Expenses charged by investments (e.g., funds, managed accounts, and certain HSAs) and commissions, interest charges and other expenses for transactions may still apply. See Fidelity.com/commissions for further details.
Fidelity does not provide legal or tax advice. The information herein is general in nature and should not be considered legal or tax advice. Consult an attorney or tax professional regarding your specific situation.
Fidelity Brokerage Services LLC, Member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917