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Savings Incentive Match Plan for Employees IRA

A Savings Incentive Match Plan for Employees IRA (SIMPLE-IRA) is a traditional IRA set up by a small employer for a firm's employees.

Expanded Definition

As of 2005 an employee may contribute up to $10,000 per year to these IRAs. After 2006, the allowable contribution will increase in $500 increments whenever the cumulative effects of inflation indicate such a rise is needed. The employer sponsoring the SIMPLE will also make a matching contribution based on a percentage of the employee's pay.

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