Question
Please answer all 4 parts of this one question: Penelopes Paint has been in business for 33 years. Penelope is retiring and passing the business
Please answer all 4 parts of this one question:
Penelopes Paint has been in business for 33 years. Penelope is retiring and passing the business on to her two children in equal shares to manage and operate according to their skills and expertise. The children, Derek and Morgan, decide to adopt a retirement plan for both current and future employees in an attempt to attract and retain talent. They have decided to adopt a SIMPLE IRA funded by both employee and employer contributions.
What are the advantages and disadvantages of offering a SIMPLE IRA over a qualified plan, such as a 401 (k)?
If Reid (age 55) a long-time employee of Penelope wants to contribute both to the SIMPLE IRA at work and to a traditional IRA, what are the limits on his contributions and deductibility regarding the traditional IRA?
What are the annual dollar limits for contributing to a SIMPLE IRA and Traditional IRA?
What are the phase out levels for making these contributions, including spousal IRA contributions?
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