What plan fits my business?
What plan fits my business?
Individual 401(k)
Reduce your personal and business taxes while having access to your money through loansFootnote 2 with this affordable plan for self-employed business owners and their spouses.
What plan fits my business?
SEP IRA
Benefit from the flexibility to contribute as your cash flow allows, while offering employees the potential for tax deferred growth and contribution limits nearly 10 times higher than a traditional IRA.
What plan fits my business?
SIMPLE IRA
Have 100 or fewer employees and predictable cash flow? Take advantage of easy plan-administration, while offering potential tax advantages to your business and employees.
What plan fits my business?
Small Business 401(k)
Attract and retain talented employees by offering an affordable, easy-to-manage 401(k) — designed for the needs of small businesses.
ContributionsFootnote 4
Contributions
Individual 401(k)
Employer contributions are generally tax deductible by business. If this is a new 401(k) plan and you have 100 or fewer employees, you may also benefit from a tax credit of up to $5000 for the first 3 years.Footnote 1 For the first 5 years, you may also benefit from an additional tax credit for making certain employer contributions, subject to certain limits and phase out over the 5-year period.Footnote 5
Plan expenses are generally tax deductible by business.
Employer contributions are flexible.
Business owners can also contribute as employees.
A Roth (after-tax salary deferrals) option is available for employee contributions.
Loans and withdrawals are available if you choose these features in your plan. Participants may incur additional taxes if certain conditions aren't met.Footnote 2
Contributions
SEP IRA
Employer contributions are generally tax deductible by business. Merrill does not charge setup or administrative fees for SEP IRAs. If this is a new retirement plan and you have 100 or fewer employees, you may also benefit from a tax credit of up to $5000 for the first 3 years.Footnote 1 For the first 5 years, you may also benefit from an additional tax credit for making certain employer contributions, subject to certain limits and phase out over the 5-year period.Footnote 5
Plan expenses are generally tax deductible by business.
Employers have the flexibility to decide whether or not to contribute in any given year as well as contribution amount.
Business owners can not contribute as employees. Contributions are made only by the business.
Employees cannot contribute.
A Roth (after-tax salary deferrals) option is not available. If made available under the Merrill SEP IRA, contributions could be designated as Roth (after-tax) contributions at the election of the employer.
Loans are not available. Withdrawals taken before age 59½ — with certain exceptions — are subject to an additional 10% early withdrawal tax.
Contributions
SIMPLE IRA
Employer contributions are generally tax deductible by business. If this is a new retirement plan, you may also benefit from a tax credit of up to $5000 for the first 3 years. For the first 5 years, you may also benefit from an additional tax credit for making certain employer contributions, subject to certain limits and phase out over the 5-year period.
Plan expenses are generally tax deductible by business.
Employer contributions are flexible.
Employees can contribute.
A Roth (after-tax salary deferrals) option is not available. If made available under the Merrill SIMPLE IRA, employee contributions could be designated as Roth (after-tax) contributions at the election of the employee.
Loans are not available.
Withdrawals taken before age 59½ — with certain exceptions — are subject to an additional 10% early withdrawal tax (increased to 25% if withdrawn within the first 2 years of contributing to the plan).
Contributions
Small Business 401(k)
Employer contributions are generally tax deductible by business. If this is a new 401(k) plan and you have 100 or fewer employees, you may also benefit from a tax credit of up to $5000 for the first 3 years.Footnote 1 For the first 5 years, you may also benefit from an additional tax credit for making certain employer contributions, subject to certain limits and phase out over the 5-year period.
Plan expenses are generally tax deductible by business.
Employer contributions are flexible.
Employees can contribute.
A Roth (after-tax salary deferrals) option is available for employee contributions.
Loans and withdrawals are available if you choose these features in your plan. Participants may incur additional taxes if certain conditions aren't met.Footnote 2
Investment Choices
Investment Choices
Individual 401(k)
Funds and model portfolios — selected and managed by Morningstar Investment Management LLC — help take the guesswork out of investing.Footnote 3
Investment Choices
SEP IRA
You and your employees can access a full range of investment choices, including stocks, bonds, options, ETFs and well-known mutual funds.
Investment Choices
SIMPLE IRA
You and your employees can access a full range of investment choices, including stocks, bonds, options, ETFs and well-known mutual funds.
Investment Choices
Small Business 401(k)
Funds and model portfolios — selected and managed by Morningstar Investment Management LLC — help take the guesswork out of investing.Footnote 3
Filing Requirements
Individual 401(k)
IRS filing is required only when plan assets are greater than $250,000. When that threshold is met, a signature-ready Form 5500 will be prepared for employer review, at no additional cost.
Filing Requirements
SEP IRA
No. IRS reporting is not required, but notification of employer contributions must be made to employees annually.
Filing Requirements
SIMPLE IRA
No. IRS reporting is not required, but notification of employer contributions must be made to employees annually.
Filing Requirements
Small Business 401(k)
Employers with eligible W-2 employees are generally required to file IRS Form 5500 annually. Businesses with no eligible W-2 employees are required to file only when plan assets are greater than $250,000. A signature-ready Form 5500 will be prepared for employer review, at no additional cost.
Contribution Limits
Contribution Limits
Individual 401(k)
Under age 50
The maximum combined business and employee annual contribution is the lesser of 100% of compensation or $69,000 in 2024 per participating employee.
50 or over
For employees age 50 and older who are eligible to make catch-up contributions, the maximum combined business and employee annual contribution is the lesser of 100% of compensation or $76,500 in 2024 per participating employee.
Contribution Limits
SEP IRA
Under age 50
For all participating employees, employer contributions are limited to the lesser of $69,000 in 2024 or 25% of eligible compensation (20% of self-employed net earnings).
50 or over
For all participating employees, employer contributions are limited to the lesser of $69,000 in 2024 or 25% of eligible compensation (20% of self-employed net earnings). Catch-up contributions are not permitted.
Contribution Limits
SIMPLE IRA
Under age 50
For employees under age 50, including business owners, the employees can defer up to $16,000 of salary in 2024. Businesses must contribute between 2% (minimum) to the lesser of 10% or $5000 (indexed for inflation) for each eligible employee regardless of participation to all eligible participants, or a dollar-for-dollar match of employee contributions up to 3% of compensation. If needed, the cap may be reduced as low as 1% for any 2 years during a 5-year period. Combined employee and employer contributions cannot exceed $32,000 in 2024.
50 or over
Employees age 50 and older, who are eligible to make catch-up contributions, including business owners, can defer up to $19,500 of salary in 2024. Businesses must contribute between 2% (minimum) to the lesser of 10% or $5000 (indexed for inflation) for each eligible employee regardless of participation to all eligible participants, or a dollar-for-dollar match of employee contributions up to 3% of compensation. If needed, the cap may be reduced as low as 1% for any 2 years during a 5-year period. Combined employee and employer contributions cannot exceed $39,000 in 2024.
Contribution Limits
Small Business 401(k)
Under age 50
The maximum combined business and employee annual contribution is the lesser of 100% of compensation or $69,000 in 2024 per participating employee.
50 or over
For employees age 50 and older who are eligible to make catch-up contributions, the maximum combined business and employee annual contribution is the lesser of 100% of compensation or $76,500 in 2024 per participating employee.