Simple IRA
First Retirement Plan offers you a low-cost retirement planning option designed
specifically for self-employed individuals, sole proprietors, partnerships and small
companies.
The First Retirement Plan SIMPLE IRA (Savings Incentive Match Plan for Employees)
provides you and your employees a way to build a retirement nest egg - while saving taxes
- through a convenient salary reduction program. While a SIMPLE IRA is funded primarily
through pre-tax employee contributions, it also requires a mandatory employer
contribution.
The SIMPLE IRA from First Retirement Plan offers you the tax advantages of a large company
retirement plan without the administrative expense, government reporting requirements or
complexity associated with other qualified retirement plans.
How a SIMPLE IRA Works
For employers with 100 or fewer employees, a Savings Incentive Match Plan for Employees
(SIMPLE) offers an attractive way to share the cost of building for a comfortable
retirement with your employees.
With many of the benefits of a 401(k) plan - and none of the burdensome administration and
testing requirements - a SIMPLE IRA allows you and your employees to save for retirement,
pre-tax, using convenient payroll deductions.
Tax savings for you and your employees. Because employee contributions
made to a SIMPLE IRA are excludable from income for federal tax purposes, you and your
employees can save on current taxes.
Tax savings for your business. As long as you don't exceed the
contribution limits, all contributions made to a SIMPLE IRA are deductible as a business
expense. This means your business' gross income is reduced by the amount of the
contributions and your tax burden is lessened.
Generous contribution limits. Employees can contribute up to $6,000 per
calendar year. This is considerably more than the $2,000 a regular IRA allows. There is no
percentage limit so an employee can allocate 100% of compensation in reaching the $6,000
limit. This $6,000 contribution limit will be indexed for cost-of-living adjustments in
increments of $500.
Employers have two options for contributing to their employees' accounts. You can either
match, dollar-for-dollar, up to 3% of compensation deferred or contribute 2% of pay for
all employees, whether they participate in the plan or not. The maximum amount of each
employee's compensation that is taken into account for the contribution limit is $160,000.
Unlike other retirement plans requiring mandatory employer contributions, SIMPLE IRAs have
a provision for lean years that allows you to reduce your 3% employer match to no less
than 1% in any two out of five years.
Less paperwork. As a result of mandatory employer contributions, SIMPLE
IRAs are not subject to non-discrimination testing. This means you can avoid the confusing
calculations and complex paperwork that make some other plans too cumbersome for many
smaller businesses.
Mutual Fund Investing through the First Omaha Family of Funds. A
professionally managed family of seven no-load funds.
For More Information on Starting Your Plan
It's easy to open a SIMPLE IRA with First Retirement Plan. Simply call 1-800-401-5460
or e-mail us at firstretirementplan@fnni.com
for the required forms. A retirement specialist will be happy to work with you and your
tax or legal advisers on your Plan. Please remember to always consult your tax and/or
legal advisers for guidance in selecting the Plan which would be best for your business.
These materials are not intended to constitute legal or tax advice.
Notice to Investors
Shares of First Omaha Funds are:
| NOT FDIC INSURED |
May lose value |
No bank guarantee |
An investment in the U.S. Government
Money Market Fund is not insured or guaranteed by the Federal Deposit Insurance
Corporation or any other government agency. Although the Fund seeks to preserve the
value of your investment at $1.00 per share, it is possible to lose money by investing in
the Fund.
First Omaha Funds are distributed by an
independent third party, SEI
Investments Distribution Co.
