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Form 5305-SIMPLE (Rev. 3-2012)
Page
Article IV—Other Requirements and Provisions
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Contributions in General. The Employer will make no contributions to the SIMPLE IRAs other than salary reduction contributions
(described in Article III, item 1) and matching or nonelective contributions (described in Article III, items 2a and 2b).
Vesting Requirements. All contributions made under this SIMPLE IRA plan are fully vested and nonforfeitable.
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No Withdrawal Restrictions. The Employer may not require the employee to retain any portion of the contributions in his or her SIMPLE
IRA or otherwise impose any withdrawal restrictions.
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No Cost Or Penalty For Transfers. The Employer will not impose any cost or penalty on a participant for the transfer of the participant’s
SIMPLE IRA balance to another IRA.
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Amendments To This SIMPLE IRA Plan. This SIMPLE IRA plan may not be amended except to modify the entries inserted in the blanks
or boxes provided in Articles I, II, III, VI, and VII.
Effects Of Withdrawals and Rollovers
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a
An amount withdrawn from the SIMPLE IRA is generally includible in gross income. However, a SIMPLE IRA balance may be rolled over or
transferred on a tax-free basis to another IRA designed solely to hold funds under a SIMPLE IRA plan. In addition, an individual may roll
over or transfer his or her SIMPLE IRA balance to any IRA or eligible retirement plan after a 2-year period has expired since the individual
first participated in any SIMPLE IRA plan of the Employer. Any rollover or transfer must comply with the requirements of section 408.
b If an individual withdraws an amount from a SIMPLE IRA during the 2-year period beginning when the individual first participated in any
SIMPLE IRA plan of the Employer and the amount is subject to the additional tax on early distributions under section 72(t), this additional tax
is increased from 10% to 25%.
Article V—Definitions
Compensation
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a
General Definition of Compensation. Compensation means the sum of wages, tips, and other compensation from the Employer subject
to federal income tax withholding (as described in section 6051(a)(3)), the amounts paid for domestic service in a private home, local
college club, or local chapter of a college fraternity or sorority, and the employee’s salary reduction contributions made under this plan,
and, if applicable, elective deferrals under a section 401(k) plan, a SARSEP, or a section 403(b) annuity contract and compensation
deferred under a section 457 plan required to be reported by the Employer on Form W-2 (as described in section 6051(a)(8)).
b Compensation for Self-Employed Individuals. For self-employed individuals, compensation means the net earnings from self-employment
determined under section 1402(a), without regard to section 1402(c)(6), prior to subtracting any contributions made pursuant to this plan on
behalf of the individual.
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Employee. Employee means a common-law employee of the Employer. The term employee also includes a self-employed individual and a
leased employee described in section 414(n) but does not include a nonresident alien who received no earned income from the Employer that
constitutes income from sources within the United States.
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Eligible Employee. An eligible employee means an employee who satisfies the conditions in Article I, item 1 and is not excluded under
Article I, item 2.
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Designated Financial Institution. A designated financial institution is a trustee, custodian, or insurance company (that issues annuity
contracts) for the SIMPLE IRA plan that receives all contributions made pursuant to the SIMPLE IRA plan and deposits those contributions to
the SIMPLE IRA of each eligible employee.
Article VI—Procedures for Withdrawals and Transfers (The designated financial institution will provide the instructions
(to be attached or inserted in the space below) on the procedures for withdrawals of contributions by employees.)
Article VII—Effective Date
. See instructions.
This SIMPLE IRA plan is effective
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Name of Employer
By:
Signature
Date
Address of Employer
Name and title
The undersigned agrees to serve as designated financial institution, receiving all contributions made pursuant to this SIMPLE IRA plan and
depositing those contributions to the SIMPLE IRA of each eligible employee as soon as practicable. Upon the request of any participant, the
undersigned also agrees to transfer the participant’s balance in a SIMPLE IRA established under this SIMPLE IRA plan to another IRA without
cost or penalty to the participant.
Name of designated financial institution
By:
Signature
Date
Address
Name and title
5305-SIMPLE
Form
(Rev. 3-2012)