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SIMPLE + 401(k)


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A client has a both a SIMPLE and a 401(k) in the controlled group. The SIMPLE only covers "personal employees" of the company's owner. They had been advised in the past that because the "personal employees" were not revenue-generating employees, they could participate in a SIMPLE despite the fact that the controlled group has a 401(k) plan for all of the company's regular employees. Any idea where the advisor may have gotten support for this position?

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Any idea where the advisor may have gotten support for this position?

Yes. It's called "find the answer that is most convenient to me" and then "find some misinformed soul to give it to me" :D The only "class" exclusions to a SIMPLE IRA is the Union, Non Resident Alien, and Employees who will not earn the minimum dollar amount ($5,000) during the current year.

Good Luck!

CPC, QPA, QKA, TGPC, ERPA

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