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Small Business

Q: What are the different types of plans for small business?

Merrill offers a wide variety of small business retirement plans, regardless of whether you have a hundred employees or just one. The most common small business retirement plans are SEP IRA, SIMPLE IRA, Small Business 401(k) and Individual 401(k).

Q: Which retirement plan is best for small business?

One size does not fit all. There are pluses and minuses to each of the plans, and only you can decide based on where you are in your business life cycle and the number of employees you currently have or may have in the future. Compare your options in order to choose the right plan for your needs. Employer plans and Self-employed plans .

Q: Do small businesses have to offer retirement plans?

There is no requirement that a small business must offer a retirement plan, but in today's competitive job market, offering an employee match through a SIMPLE IRA or Small Business 401k can make your business more attractive to candidates. 88% of workers surveyed view a 401(k) or similar plan as an important benefit. If you're just starting out, Learn more about SIMPLE IRA or Small Business 401(k) .

Q: Will I receive a tax credit by offering retirement plans to my employees?

If you have fewer than 100 employees, there are potential tax advantages for opening a SIMPLE IRA. A Savings Incentive Match Plan for Employees (more commonly referred to as a SIMPLE IRA) may be a good option for you. With a SIMPLE IRA, the plan is funded by employee salary deferrals and required employer contributions. Learn more about a SIMPLE IRA .

Explore workplace retirement plans for your small business

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You can contribute significantly more to a workplace retirement plan than to a traditional or Roth IRA, reduce taxes now and pay taxes later.

Workplace Retirement Plan Benefits

Potentially reduce your business taxes with tax-deductible contributions

Let earnings grow tax‑deferred until they are withdrawn

Attract and retain employees in a challenging labor market

Diversify your retirement strategy beyond your plans for your business

Question:

How much more can I contribute to a workplace retirement plan than to a traditional or Roth IRA?

Answer:

Depending on which plan type you choose, you may be able to contribute nearly ten times more than a traditional or Roth IRA alone (up to $69,000 compared to $7,000 for 2024).Footnote ²

Find the plan that can meet your needs

Merrill has a workplace retirement plan that's right for you, whether you're the only one working for your business or you're considering your employees' needs too.

Employer plan information Self employed plan information

SIMPLE IRA

If you have 100 or fewer employees, make mandatory contributions to an easy-to-manage plan with potential tax advantages.Footnote ¹

SIMPLE IRA Features

Open your account online and you won't have program or administrative fees

Take advantage of tax breaks for you and your employeesFootnote ¹

Choose from a full range of investment choices at Merrill

Small Business 401(k)

Attract and retain talented employees with a low-cost 401(k) plan designed for small businesses.

Small Business 401(k) Features

Contribute more than 3 times the limit of a traditional IRAFootnote ²

Access potential tax advantages for you, your business and your employeesFootnote ¹

Choose from a menu of funds chosen by Morningstar.Footnote ³

SEP IRA

Contribute as your cash flow allows with limits nearly 10 times higher than the limits for a traditional IRA.Footnote ¹

SEP IRA Features

Reduce your admin with a SEP IRA, a plan that requires less paperwork

Decide how much you want to contribute

Choose from a full range of investment choices at Merrill

Compare employer plans at Merrill

Of the business owners facing labor shortages, 83% are taking additional steps to retain employees and attract new talent.Footnote ⁵

Individual 401(k)

As the owner, make contributions that are generally tax deductible by the business and contribute as an employee to reduce your taxes.Footnote ¹

Individual 401(k) Features

Choose to withdraw funds when you need them (taxes may apply)Footnote ⁴

Reduce your taxes while having access to your money through loansFootnote ⁴

Choose from a full range of investment choices at Merrill

SEP IRA

Contribute as your cash flow allows with limits of up to $66,000 for yourself and each eligible employee

SEP IRA Features

Reduce your admin with a SEP IRA, a plan that requires less paperwork

Decide how much you want to contribute

Choose from a full range of investment choices at Merrill

Compare self employed plans at Merrill

More than half of Merrill retirement plans belong to self-employed small business owners.Footnote ⁶

Managing finances for your business has never been easier

Simplify your account management with a single login for Merrill investing and Bank of America banking accounts
Access competitive pricing and outstanding customer service available through Merrill
Manage your plan and invest anytime, anywhere with our secure mobile app

Explore more benefits for your business available through Bank of America and Merrill

Checking benefit information Credit cards benefit information Loans benefit information HSA benefit information Investing benefit information

Check out all the Bank of America small business resources.

Plus, learn about rewards available through Bank of America Preferred Rewards for Business.

Explore all plans available for small business

Get more details about small business retirement plans available at Merrill and find the one that works best for your needs.

SEP IRA plan information SIMPLE IRA plan information Small Business 401(k) plan information Individual 401(k) plan information

Ready to get started?

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If you have questions, contact a specialist at 855.667.9451

Frequently Asked Questions

Expand all

What are the different types of plans for small business?

Which retirement plan is best for small business?

Do small businesses have to offer retirement plans?

Some states have passed legislation requiring businesses to provide a retirement savings program for their employees. The form of this program will vary depending on the size of your business and the state in which your business is located. In states without mandated programs, there is no requirement that a business must offer a retirement plan. But in today's competitive job market, offering an employee match through a SIMPLE IRA or Small Business 401(k) can make your business more attractive to future employees, while you receive the benefits of having a workplace retirement plan now. If you're just starting out, learn more about SIMPLE IRA or Small Business 401(k).

What's the difference between a SEP IRA and an Individual 401(k)?

A SEP IRA allows you to save up to 25% of your income in the account. In contrast, with a solo 401(k), you can save up to 100% of your income as an employee contribution (up to the annual threshold) and then you can flip to employer contributions with a limit of up to a 25% of your income. Both account types are easy to open with Merrill. Learn more about a SEP IRA or an Individual 401(k).

Will I receive a tax credit by offering retirement plans to my employees?

There may be two specific credits you could take advantage of — the Employer Contribution Tax Credit and the Plan Cost Tax Credit.

The Employer Contribution Tax Credit is based on contributions made to eligible employees, by the business, over the first few years of the plan. The Plan Cost Tax Credit pertains to eligible plan start up costs. For more information, speak with your tax advisors or visit IRS.gov.

What is the between a SEP IRA and a SIMPLE IRA?

Whether you are self-employed or have employees, a SEP IRA allows you to benefit from the flexibility to contribute as your cash flow allows. It also offers the potential for tax-deferred retirement growth and contribution limits nearly 10 times higher than a traditional IRA. However, if you have 100 or fewer employees and need predictable cash flow, a SIMPLE IRA might be the better option; it offers the advantage of easy plan administration as well as potential tax advantages to your business and employees. Learn more about a SEP IRA or a SIMPLE IRA.

Footnote ¹ For more information on contribution limits, visit irs.gov popup.

Footnote ² Contribution and compensation limits are subject to an annual cost-of-living adjustment pursuant to the Internal Revenue Code. Contribution and compensation limits for subsequent years may vary. For additional details visit irs.gov popup

Footnote ³ Plan- and participant-level administrative and recordkeeping services for Merrill Small Business 401(k) plans are provided by Ascensus. Investment advisory and fiduciary services are provided by Morningstar Investment Management LLC, a registered investment advisor and wholly owned subsidiary of Morningstar, Inc. Morningstar Investment Management LLC is a provider of investment management solutions, including investment advisory and retirement plan services. Educational call center support will be provided by Ascensus. Bank of America Corporation, Ascensus and Morningstar Investment Management LLC are not affiliated.

Footnote ⁴ Please consider the advantages and disadvantages of taking a loan before initiating one. For more information about loans and withdrawals visit Know the facts about loans and withdrawals (PDF).

Footnote ⁵ Bank of America's Small Business Report (PDF). Published May 3, 2022.

Footnote ⁶ Based on internal data as of October 14, 2022.

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Investing in securities involves risks, and there is always the potential of losing money when you invest in securities.

Asset allocation, diversification, and rebalancing do not ensure a profit or protect against loss in declining markets.

Merrill, its affiliates, and financial advisors do not provide legal, tax, or accounting advice. You should consult your legal and/or tax advisors before making any financial decisions.

This material is not intended as a recommendation, offer or solicitation for the purchase or sale of any security or investment strategy. Merrill offers a broad range of brokerage, investment advisory (including financial planning) and other services. Additional information is available in our Client Relationship Summary (PDF).

Merrill Lynch, Pierce, Fenner & Smith Incorporated (also referred to as "MLPF&S" or "Merrill") makes available certain investment products sponsored, managed, distributed or provided by companies that are affiliates of Bank of America Corporation ("BofA Corp."). MLPF&S is a registered broker-dealer, registered investment adviser, Member Securities Investor Protection (SIPC) popup and a wholly owned subsidiary of Bank of America Corporation ("BofA Corp").

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Banking products are provided by Bank of America, N.A. and affiliated banks, Members FDIC and wholly owned subsidiaries of Bank of America Corporation.

Investment products offered through MLPF&S and insurance and annuity products offered through MLLA:

Are Not FDIC Insured	Are Not Bank Guaranteed	May Lose Value
Are Not Deposits	Are Not Insured by Any Federal Government Agency	Are Not a Condition to Any Banking Service or Activity

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Investing in securities involves risks, and there is always the potential of losing money when you invest in securities.

Asset allocation, diversification, and rebalancing do not ensure a profit or protect against loss in declining markets.

The performance data contained herein represents past performance which does not guarantee future results. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance information current to the most recent month end, please contact us.

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Merrill, its affiliates, and financial advisors do not provide legal, tax, or accounting advice. You should consult your legal and/or tax advisors before making any financial decisions.

Banking products are provided by Bank of America, N.A. and affiliated banks, Members FDIC and wholly owned subsidiaries of Bank of America Corporation ("BofA Corp.").

Merrill Lynch Life Agency Inc. (MLLA) is a licensed insurance agency and wholly owned subsidiary of BofA Corp.

Investment products offered through MLPF&S and insurance and annuity products offered through MLLA:

Are Not FDIC Insured

Are Not Bank Guaranteed

May Lose Value

Are Not Deposits

Are Not Insured by Any Federal Government Agency

Are Not a Condition to Any Banking Service or Activity

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