SEP IRA

Archive for the ‘SIMPLE IRA Contributions’ Category

Question: What is the difference between a TSP and a SIMPLE IRA? They have different Contribution limits?

I am talking about the Thrift Savings plan that federal employees have access to. Does anyone have a good comparison?
I have a good understanding of SIMPLE and ROTH IRAs, so if you could relate to that, I would be grateful.

Answer: I’m not a financial advisor but I’ll give this my best shot.

My understanding of the Thrift Savings Plan (TSP) is that it is an employers sponsored plan similar to a 401K in the private sector. So one of the main differences is that an Independent Retirement Account (IRA) is, as the name implies, independent, ie. not sponsored by an employer and therefore is set up by the individual employee. I believe the Federal Government may offer some type of “matching” funds, ie. if the employee puts money into the TSP the government will match it up to a certain level. If this is the case it is WAY better to invest in that than in an IRA for which you would receive no matching money from the government. I do not know if the TSP puts in before or after tax dollars. If you work for the Federal Government you can ask your personnel office for help. If you search for it online you should probably find many details.

Finance & Investment Tips : What Is a IRA Account?

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Question: Do Roth IRA and employee sponsored SIMPLE IRA Contributions treated separately with regards to annual limits?

I have a ROTH IRA and an employee sponsored SIMPLE IRA. I make maximum contributions to my Roth IRA each year. I also wish to make maximum contributions to my SIMPLE, since there is company matching. The SIMPLE IRA limits state $10,000 / year max Contribution, and the Roth is much less than this for my tax bracket. Are the contributions for these 2 types of IRAs additive with regards to limits ? Or are both annual limits treated separately ?

Answer: Wav, no answer for 5 days! It looks like this is tough question or topic is not popular! Let me tackle this one.

Short Answer: Yes, Roth IRA and SIMPLE IRA Contributions are treated as independent of each other.

Check this link for detail information:

http://www.theusefulinfo.com/finance/2007/04/can-i-rollover-from-401k-to-roth-ira.html

-Infoman
Not a legal advice.

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