<img src="//bat.bing.com/action/0?ti=5104607&amp;Ver=2" height="0" width="0" style="display:none; visibility: hidden;">

Learning Center


Access the largest knowledge base for Self-Directed IRAs. Expand your investor knowledge with articles, whitepapers, practical guides and tons of other educational resources.

About Entrust


For 40 years, The Entrust Group has provided account administration services for self-directed retirement and tax-advantaged plans. Entrust can assist you in purchasing alternative investments with your retirement funds, and administer the buying and selling of assets that are typically unavailable through banks and brokerage firms.

Common Questions About SEP and SIMPLE IRAs for Small Business Owners

Common Questions About SEP and SIMPLEWhile the rules governing SEP and SIMPLE IRAs—two of the most common plans for small business owners—are purposefully straightforward, we often hear a few of the same questions. These answers apply whether you have a Self-Directed IRA or a traditional retirement plan typically offered by big banks and brokerage houses.


SEP IRA (Simplified Employee Pension)

Who can establish a SEP?

Any employer, including self-employed individuals, can establish a SEP.

If I have a SEP, can I also have other retirement plans?

You can maintain both a SEP and another plan as long as the other plan is not a SIMPLE plan. Also, unless the other plan is another SEP, you cannot use Form 5305-SEP; you must adopt either a prototype SEP or an individually designed SEP.

Which employees are eligible to participate?

Employees over the age of 21 who have worked for the employer for three out of the last five years have met the minimum eligibility requirements. To receive a contribution for the year, an employer can also require that the employee has received at least $600 in compensation.


Account Guide

Find out which account type is right for you

Get Your Account Guide


SIMPLE IRA (Savings Incentive Match Plan for Employees Individual Retirement Account)

Is there a deadline to set up a SIMPLE plan?

You can set up a SIMPLE plan effective on any date between January 1 and October 1, provided you didn’t previously maintain a SIMPLE plan. If you’re a new business that came into existence after October 1, you can establish the SIMPLE plan as soon as you are able to after starting business.

Are employer contributions mandatory?

Yes. The employer can choose either to match the employee’s contribution dollar for dollar up to 3 percent of the employee’s compensation, or contribute a non-elective contribution based on 2 percent of compensation with no matching.

What kind of assets can I invest in with a Self-Directed SIMPLE IRA?

The same as other Self-Directed IRAs, you can invest in alternative assets not available with a traditional retirement plan. These include investing in apartments and mortgage notes, gold and certain coins, as well as corporations and private stock and many others. 

These answers were adapted from information on the IRS website. You can explore these tax advantaged plans further with Entrust’s report for small business owners. If you have other questions—from SEP IRA reporting to SIMPLE IRA eligibility—be sure to watch the recording of our webinar, Retirement Plans for Small Business Owners: Live Q&A.


Watch our webinar recording

Like what you read?

Subscribe to our newsletter to get in-depth articles, right in your inbox every month

Investing With IRA LLCs: Is Checkbook Control Right for You?

Register for our next webinar on Wednesday, September 20, 2023 at 11:00 a.m. PT / 2:00 p.m. ET

Save Your Spot