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Are there any institutions that will accept part of a company's simple


Guest jasper
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Currently I have a simple ira plan for my

employees with a full service brokerage

firm. The brokerage firm also handles the paperwork. Some employees don't like paying for loaded funds. I want to know if there are investment firms that will let these

employees invest with them if the rest of my

company does not. I have ask a bank that has

a simple ira plan but they will only take all

or nothing and while they don't have loaded funds they do charge 1% a year of your total

portfolio as a fee. Isn't that worse than paying for a loaded fund in the long run?

Thanks in advance.

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  • 1 year later...
Guest Sharon Tate

Jeez- I gues this is kinda late- but I just joined yesterday.

The firm is not authorized to make this rule. The IRS clearly states in the SIMPLE IRA rule that the employer must allow employees to maintain their SIMPLE IRAs at another institution.

Here is the rule.

If you use a SIMPLE 5305- accounts must be establsih at the institution wher eyou establish the plan for all employees to receive their contributions. they can always transfer the contributions to a second SIMPLE IRA established at another firm afterwards.

however, if you use a SIMPLE5304- the contributiosn cna be made directly to the SIMPLE account established at the other firm

I know a firm that will allow this- they know the rules

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If the business owner completed the 5304-SIMPLE adoption agreement, the employees are not restricted to the financial institution. However, if the employee deceides to establish a SIMPLE IRA at another institution (to accept future contributions), the new institution might request a copy of the adoption agreement before they will allow the employee to establish the SIMPLE account and accept contributions.

If the owner used the 5305-SIMPLE the employees must stay at the designated financial institution (as designated by the employer).

This information is provided in the SPD which should be sent to all employees each year (as a matter of fact they should be getting one by October 1)

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Guest Taxwoman

Not quite jbc@edj ,

If the employer uses 5305-SIMPLE, the employees are required to establish their SIMPLE IRAs where the employer establishes the plan. But as Sharon stated, these employees may still establish 5305-SIMPLE at another financial institution to which their SIMPLE assets cna be transferred or rolled. The stipulation is that all contributions must be initially made to the SIMPLE account established at the location where the employer established the plan, which means that an employee who wants to hold his/her assets elswhere will have two SIMPLE accounts- one to receive the contributions when they are initially made and another to which the assets cna be transferred, after they are made to the first

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