IRS Publication 560: Retirement Plans for Small Business (SEP, SIMPLE and Qualified Plans) delineates and updates the rules each year for employers establishing retirement plans for themselves as well as their employees.
IRS Publication 560: Retirement Plans for Small Business (SEP, SIMPLE and Qualified Plans) is a document published each year by the Internal Revenue Service detailing information for business owners who wish to set up retirement plans for themselves and their employees.
This document provides details on
Publication 560 delineates four primary employer retirement plans, including SEP plans, SIMPLE plans and two types of qualified plan: defined contribution and defined benefit.
SEP plans provide a simplified method for employers to make contributions to a retirement plan for themselves as well as employees. Rather than setting up a profit-sharing or money purchase plan with a trust, an employer may adopt a SEP agreement and make contributions directly to a traditional IRA or a traditional individual retirement annuity (SEP-IRA) set up for themselves and each eligible employee.
As with many IRS documents, various stipulations change from year to year, so it is imperative that all those affected by the section of the tax code refer to the latest version. Many employers will require professional guidance.
In particular, for the 2017 tax year, Publication 560 did not cover several rules which may be pertinent to some employees, including the comprehensive IRA rules for employees, the comprehensive rules that apply to distributions from retirement plans, and the comprehensive rules that apply to section 403(b) plans.