What is a Simple IRA?

A Simple IRA is a qualified retirement plan that can be established by employers, including those who are self-employed. Eligible employees can contribute a portion of their pre-tax income into a Simple IRA account. These funds grow tax-deferred until their distribution. Employers are required to make contributions into these accounts on behalf of their qualified employees; elective (matching percentage) or non-elective contributions (made even if the employee does not participate in the retirement plan).