Devoted to understanding the basics and fundamentals of investing

You are undoubtably tired of my disclaimers about not being a tax attorney or tax accountant.  But I have no desire to practice law without a license or to displace CPAs who are licensed to give specific tax advice.  My post is educational and general in nature.

I would like to write a bit about a plan the government has made available called SIMPLE (Savings Incentive Match Plan for Employees of Small Employers).  This is for businesses that employ less than 100 people.  The SIMPLE plan is a defined contribution plan similar to a 401(k).  It allows employees to make before tax contributions towards their retirements.  It allows employers to match those contributions up to 3%.

The maximum employee contribution is $6,000 with some make up provisions if you are over 50.  The maximum employer matching contribution is 3% of employee wages or a fixed contribution of 2% of wages regardless of employee contributions.

The Department of Labor has a nice article on SIMPLE plans.  The article can be found at this Department of Labor web page.