What type of business are you modeling? (Sole Proprietorship/Partnership or Corporation)

The way estimated contributions are calculated for a business owner who is eligible to participate in the plan is dictated by the way the sponsoring business is structured.

If the sponsoring business files its federal tax return as a sole proprietor or partnership (e.g., Schedule C, Schedule F or Form 1065), you should select "Sole Proprietorship/Partnership."

If the sponsoring business files its federal tax return as a corporate entity (e.g., Form 1120 or Form 1120- S), you should select "Corporation."

Note: If the sponsoring business is organized under state law as a limited liability corporation (LLC), the appropriate selection for this question will depend on whether the business files a federal return as a partnership (e.g., Form 1065) or as a corporation (e.g., Form 1120).

Select the applicable tax year for which you would like to model plan coverage/contributions.

A common-law employee is a person who performs services for an employer who has the right to control and direct the results of the work and the way in which it is done.

For example, the employer:

• Provides the employee's tools, materials, and workplace; and
• Can fire the employee.

When establishing a business retirement plan, a business must take into consideration all common-law employees when assessing who must be covered under the plan. Generally speaking, the sponsoring business must provide retirement plan coverage for those common-law employees who meet the plan's eligibility requirements. While there are specific circumstances under federal law where a business may exclude certain classes of employees from plan participation, a business may not arbitrarily ignore common-law employees when determining who will be eligible for coverage under a business retirement plan.

If you own multiple businesses, you may be required to cover all employees of all owned businesses under this plan. Review controlled group rules with your tax advisor.

SIMPLE IRA plans may generally only be established by employers who employed no more than 100 employees/owners who received at least $5,000 in compensation from the employer for the preceding year. This is commonly referred to as the "100-employee limitation" rule. All employees/owners employed at any time during the calendar year are taken into account, regardless of whether they are eligible to participate in the SIMPLE IRA plan.

An employer maintaining a SIMPLE IRA plan may not maintain other employer retirement plans in which employees currently receive contributions or accrue benefits. This requirement is often referred to as the "exclusive plan" rule. For purposes of this requirement, other employer retirement plans include

• simplified employee pension (SEP) plan,
• SIMPLE plan,
• plan qualified under Code section 401(a) such as pension, profit sharing or 401(k) plan,
• 403(b) arrangement,
• 403(a) arrangement, or
• plan established for employees of a State, a political subdivision or by an agency or instrumentality of any State or political subdivision (other than an eligible deferred compensation plan described in IRC Sec. 457(b)).

Business Owner Information

Eligibility in the SIMPLE IRA plan is limited to owners and employees who meet both current compensation and prior compensation requirements as outlined in the employer-level SIMPLE IRA plan document. If this individual does not meet the plan's compensation requirements for the modeling year, do not enter the business owner's information on this screen.

First Name: Enter the business owner's first name

Last Initial: Enter the first initial of the business owner's last name

Year of Birth: Enter the business owner's year of birth (YYYY)

Estimated Self-Employment Earnings: Enter the business owner's estimated net earnings from self-employment. Generally, net earnings are equal to the self-employed business owner's gross income from the trade or business (provided the business owner's personal services are a material income-producing factor) minus allowable business deductions. For purposes of this tool, the earnings entered here are presumed to be net earnings prior to any deductions for self-employment taxes and, if applicable, any deductions for retirement plan contributions made on behalf of common-law employees.

Anticipated Salary Deferral: Enter the business owner's anticipated salary deferral amount.

Prior Year(s) of Service: Under a SIMPLE IRA plan, sponsoring businesses may require individuals to have completed up to two (2) prior years of service with the sponsoring employer to be eligible to participate in the SIMPLE IRA plan. As a general rule, individuals must earn $5,000 during a given year to be credited with a year of service (adopting employers may, however, select a lower dollar threshold when adopting a SIMPLE IRA plan). Based on the dollar threshold selected in the SIMPLE IRA plan document ($5,000 or less), indicate whether the individual has accrued 0, 1 or 2+ years of service prior to the year for which plan modeling is being conducted.

Business Owner Information

Eligibility in the SIMPLE IRA plan is limited to owners and employees who meet both current compensation and prior compensation requirements as outlined in the employer-level SIMPLE IRA plan document. If this individual does not meet the plan's compensation requirements for the modeling year, do not enter the business owner's information on this screen.

First Name: Enter the business owner's first name.

Last Initial: Enter the first initial of the business owner's last name.

Year of Birth: Enter the business owner's year of birth (YYYY).

Estimated W-2 Compensation: Enter the business owner's estimated gross income reported on IRS Form W-2 (Wage and Tax Statement).

Anticipated Salary Deferral: Enter the business owner's anticipated salary deferral amount.

Prior Year(s) of Service: Under a SIMPLE IRA plan, sponsoring businesses may require individuals to have completed up to two (2) prior years of service with the sponsoring employer to be eligible to participate in the SIMPLE IRA plan. As a general rule, individuals must earn $5,000 during a given year to be credited with a year of service (adopting employers may, however, select a lower dollar threshold when adopting a SIMPLE IRA plan). Based on the dollar threshold selected in the SIMPLE IRA plan document ($5,000 or less), indicate whether the individual has accrued 0, 1 or 2+ years of service prior to the year for which plan modeling is being conducted.

Prior Year(s) of Service:

Under a SIMPLE IRA plan, sponsoring businesses may require individuals to have completed up to two (2) prior years of service with the sponsoring employer to be eligible to participate in the SIMPLE IRA plan. As a general rule, individuals must earn $5,000 during a given year to be credited with a year of service (adopting employers may, however, select a lower dollar threshold when adopting a SIMPLE IRA plan). Based on the dollar threshold selected in the SIMPLE IRA plan document ($5,000 or less), indicate whether the individual has accrued 0, 1 or 2+ years of service prior to the year for which plan modeling is being conducted.

This modeling tool includes calculations to estimate the self-employment taxes that will by be payable on the business owner's self-employment earnings entered in the "Estimated Self-Employment Earnings/Estimated W-2 Income" field. In situations where the business owner has other taxable compensation for the given modeling year, the calculation assumptions incorporated within this modeling tool may not accurately reflect the business owner's "compensation" for plan contribution modeling.

Employee Information

Eligibility in the SIMPLE IRA plan is limited to owners and employees who meet both current compensation and prior compensation requirements as outlined in the employer-level SIMPLE IRA plan document. If this individual does not meet the plan's compensation requirements for the modeling year, do not enter the employee's information on this screen.

First Name: Enter the employee's first name.

Last Initial: Enter the first initial of the employee's last name.

Year of Birth: Enter the employee's year of birth (YYYY).

Estimated W-2 Income: Enter the employee's estimated gross income reported on IRS Form W-2 (Wage and Tax Statement).

Anticipated Salary Deferral: Enter the employee's anticipated salary deferral amount.

Prior Year(s) of Service: Under a SIMPLE IRA plan, sponsoring businesses may require individuals to have completed up to two (2) prior years of service with the sponsoring employer to be eligible to participate in the SIMPLE IRA plan. As a general rule, individuals must earn $5,000 during a given year to be credited with a year of service (adopting employers may, however, select a lower dollar threshold when adopting a SIMPLE IRA plan). Based on the dollar threshold selected in the SIMPLE IRA plan document ($5,000 or less), indicate whether the individual has accrued 0, 1 or 2+ years of service prior to the year for which plan modeling is being conducted.

Prior Year(s) of Service:

Under a SIMPLE IRA plan, sponsoring businesses may require individuals to have completed up to two (2) prior years of service with the sponsoring employer to be eligible to participate in the SIMPLE IRA plan. As a general rule, individuals must earn $5,000 during a given year to be credited with a year of service (adopting employers may, however, select a lower dollar threshold when adopting a SIMPLE IRA plan). Based on the dollar threshold selected in the SIMPLE IRA plan document ($5,000 or less), indicate whether the individual has accrued 0, 1 or 2+ years of service prior to the year for which plan modeling is being conducted.