annual fees

[Felicia]

If you are charging annual maintenance fees on SEPs, SARSEPs and/or SIMPLE IRAs, who is being charged: the participant's account? the participant? the employer? any combination of the above?

And, what fee is being charged?

[Bird]

Any work we do on these types of plans is billed hourly, to the employer.

I don't see how you could get money out of the participants' accounts, unless you are the custodian/trustee.

[mbozek]

F: Who is charging the fees and for what kind of services? I dont see why any other party other than the the custodian needs to charge the IRA accounts for services since the only required action is for the er to make a discretionary contribution to the ee's IRA which is reported to the employee.

I thought that SEP or SIMPLE plan were designed to eliminate the admin costs of TPAs so that all contributions would go the participant's accounts.

[R. Butler]

I thought that SEP or SIMPLE plan were designed to eliminate the admin costs of TPAs so that all contributions would go the participant's accounts.

That was what the design was supposed to do, but that is a nicer thought than reality. In our experience, particularly with the SIMPLE-IRA, plan sponsors have difficulty indentifying eligibles, rarely provide notices timely & often times have difficulty calculating the employer contribution.

Like Bird, any work we do is billed to the employer.

[mbozek]

If the plan will incur those costs, why not adopt a simple 401k plan so that assets are exempt from creditors of the employee, plan loans will be available and the employees accounts can be charged for the costs?

[Felicia]

Are any SIMPLEs, SEPs or SARSEPs paying custodial fees? If so, how are they handled?

[Belgarath]

And just to expand upon Rbutler's observation, many unincorporated sole props want help in calculating the proper contribution for themselves. We don't do any admin on SEP's, but we get this request a lot. If we ever decided to do this, we would certainly bill the employer for our services.