Get the free Form 5304-SIMPLE

Form 5304-SIMPLE is a model document for establishing a SIMPLE IRA plan, allowing eligible employees to make salary reduction contributions while the employer may also contribute matching or non-elective

How to fill out form 5304-simple

How to fill out Form 5304-SIMPLE

1. Download Form 5304-SIMPLE from the IRS website.
2. Fill in the name of the employer in the designated space at the top of the form.
3. Enter the employer's identification number (EIN) on the form.
4. Provide the tax year for which you are filing the form.
5. Specify whether you will elect to use a SIMPLE IRA plan for this year.
6. Indicate the eligible employees' names, social security numbers, and other required information.
7. Detail the contribution limits and employee salary deferral amounts.
8. Include any additional information requested in the instructions.
9. Review the completed form for accuracy.
10. Submit the form to the IRS and provide copies to employees.

Who needs Form 5304-SIMPLE?

1. Employers who want to establish a SIMPLE IRA plan for their employees.
2. Small business owners who have 100 or fewer employees.
3. Employers who are looking to offer a retirement savings option without complex requirements.

People Also Ask about

What are the downsides of a SIMPLE IRA for employees?

Are There Downsides to SIMPLE IRAs and SEPs? Employee limitations. SIMPLE IRAs can only be implemented at companies with 100 or fewer employees. Total annual contribution limits. Lower contribution limits than a 401(k). Mandatory employer contributions. No loans or Roth contributions.

What if I contributed too much to my SIMPLE IRA?

To remove an excess contribution, complete the Distribution Request for Excess Contributions From SIMPLE IRAs. Excess contributions may be subject to taxes and penalties. Review SIMPLE IRA tax information for more information.

Does the employer have to match 3% for a SIMPLE IRA?

How much must I contribute for my employees participating in our SIMPLE IRA plan? You're generally required to either: match each employee's salary reduction contribution on a dollar-for-dollar basis up to 3% of the employee's compensation (not limited by the annual compensation limit), or.

What happens if I accidentally overcontribute to IRA?

The penalty for an excess IRA contribution is 6% on the excess amount for every year the excess stays in your account. Filing an amended return before the October extension deadline can help you avoid the 6% penalty.

How do I fix excess contributions to my IRA?

You can either: Remove the excess within 6 months and file an amended return by October 15 — if eligible, the excess plus your earnings can be removed by this date. Remove the excess once discovered, even after October 15. You'll need to reduce next year's contributions by the amount of the excess.

What do I do if I put too much money in my IRA?

You might contribute the maximum amount early in the year and then realize that your salary was less at the end of the year. You can withdraw the money, recharacterize the excess contribution into a traditional IRA, or apply your excess contribution to next year's Roth.

What happens if I overcontribute to my SIMPLE IRA?

If you don't remove excess contributions and any investment earnings from those contributions by the tax filing deadline plus any extensions, you may have to pay a 6% penalty on those contributions every year until they are removed.

What is 5304?

A Savings Incentive Match Plan for Employees of Small Employers (SIMPLE) Individual Retirement Account (IRA) Plan is a tax-favored retirement plan that certain small employers (including self-employed individuals) can set up for the benefit of their employees.

For pdfFiller’s FAQs

What is Form 5304-SIMPLE?

Form 5304-SIMPLE is a financial form used by employers to establish a SIMPLE (Savings Incentive Match Plan for Employees) IRA plan under the IRS regulations. It outlines the plan's terms and conditions.

Who is required to file Form 5304-SIMPLE?

Any employer that wishes to set up a SIMPLE IRA plan for their employees must file Form 5304-SIMPLE if they choose a SIMPLE IRA plan instead of a SIMPLE 401(k) plan.

How to fill out Form 5304-SIMPLE?

To fill out Form 5304-SIMPLE, employers must provide information such as the plan year, the type of contributions, and any eligibility requirements. The form should be completed accurately and signed by the employer.

What is the purpose of Form 5304-SIMPLE?

The purpose of Form 5304-SIMPLE is to communicate the details and provisions of a SIMPLE IRA plan to the IRS and the employees, enabling tax advantages for both the employer and employees.

What information must be reported on Form 5304-SIMPLE?

Information required on Form 5304-SIMPLE includes employer's identification details, the choice between employee salary reduction contributions or employer matching contributions, and the terms of the SIMPLE IRA plan.