Small Business Retirement Specialist   800-638-3804

This chart is a side-by-side comparison of small business retirement plan options—features, benefits, and requirements. For detailed plan information, simply click on the individual titles or call a T. Rowe Price small business retirement specialist at 1-800-638-3804.

Plan Features T. Rowe Price
SEP-IRA
T. Rowe Price Individual 401(k) T. Rowe Price
SIMPLE IRA
T. Rowe Price
401(k) for
Small Businesses

Who is it for?

For self-employed individuals and business owners who wish to make contributions for employees at a low administrative cost

For one person business owners who want to make the highest contribution possible (for themselves and a working spouse)

For self-employed individuals businesses with up to 100 employees who wish to allow both employee and employer contributions

Generally, for employers with fewer than 1,000 employees who wish to offer a cost-effective 401(k) plan

Key benefits

Easy and inexpensive to set up and maintain

Allows for the highest contributions in many cases

A low-cost and easy to administer plans

Retirement plan with both employee and employer contributions, allowing sponsor and participant to maximize tax deductions and tax-deferred savings

What is the maximum employer deductible contribution?*

25% of total compensation** of all eligible employees

25% of total compensation** of eligible participants (i.e., owner, and if applicable, working spouse)

Employer chooses either:

Non-elective contributions of 2% of each eligible employee's compensation**

OR

Matching contributions of each employee's salary reduction contributions dollar-for-dollar up to 3%*** of the employee's compensation.

25% of total compensation** of all eligible employees.

May employees contribute?

No

Yes

Yes

Yes

What is the salary deferral limit?

N/A

For 2015 and 2016, the lesser of:
100% of compensation or $18,000 ($24,000 if age 50 or older)

For 2015 and 2016, the lesser of:
100% of compensation or $12,500 ($15,500 if age 50 or older)

For 2015 and 2016, the lesser of:
100% of compensation or $18,000 ($24,000 if age 50 or older)

Is the plan subject to a vesting schedule?

N/A

No

N/A

Optional for the employer

What are the annual participant fees?

$20 account service fee for each mutual fund account with a balance below $10,000.

$20 account service fee for each mutual fund account with a balance below $10,000.

$20 account service fee for each mutual fund account with a balance below $10,000.

Varies depending on service structure and plan economics

What are the IRS filing requirements?

None

May require annual IRS Form 5500

None

IRS Form 5500

Is the plan qualified?

No, IRA based

Yes (defined contribution)

No, IRA based

Yes

What plan eligibility requirements can the employer choose to set?

Age:
no more than 21

Earnings:
$600 in 2015 and 2016

Years of Service:
employed by the current employer in up to three of the past five years

Age:
no more than 21

Earnings:
no restriction allowed

Years of Service:
no more than one year

Age:
no restriction allowed

Earnings:
not to exceed $5,000

Years of Service:
no more than two years

Various options generally based on age and service

What is the plan setup deadline?

Your company's tax filing deadline (including extensions)

By the end of the initial plan year, generally
December 31

Generally, anytime prior to October 1 of each calendar year (for existing employers)

By the end of the initial plan year, generally
December 31

May I still contribute to an IRA?

Yes††

Yes††

Yes††

Yes††

*The maximum deductible contribution for federal income tax purposes.

**Maximum amount of compensation that can be used in determining contribution is $265,000 for tax years 2015 and 2016. This amount is increased periodically for inflation.

***May be as low as 1% in no more than two years out of five consecutive calendar years.

The $20 account service fee will be waived for the following circumstances: Subscribe to electronic delivery of statements and confirmations (participants can subscribe to paperless delivery via the T. Rowe Price website once their account is established.); maintain an individual combined balance of $50,000 or more for all T. Rowe Price accounts (including mutual funds, Brokerage, and Small Business Retirement Plans); or qualify for T. Rowe Price Select Client Services based on higher asset levels of $100,000 or more. If the Participant Account is closed during the year, a $20 closeout fee will be deducted automatically from the proceeds of the total redemption. However, the closeout fee is waived when an account service fee was previously assessed to the participant for that year or when the proceeds are being used for a rollover, transfer or conversion to a T. Rowe Price retirement plan account or T. Rowe Price IRA account.

††Contributions may or may not be deductible.