Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
cancel
Showing results for 
Search instead for 
Did you mean: 
FreeLunch
New Member

SIMPLE IRA Startup Costs Credit -

My understanding is that a business setting up a SIMPLE IRA can get a start up cost credit per form 8881.  However, what is an ordinary and necessary expense for establishing a plan for a small business with a few employees? I'm just trying to see if this would be applicable for my small business if I setup a plan.  Does anyone have typical examples of an ordinary and necessary expense for a small business with just a couple of employees?  Thanks!

 

"Qualified start-up costs are any ordinary and necessary expenses paid or incurred in connection with establishing or administrating the plan or retirement-related education of employees for the plan (IRC §45E(d)(1))."

2 Replies
Critter-3
Level 15

SIMPLE IRA Startup Costs Credit -

These are usually the administrative costs that the IRA plan administrator bills you for. 

GeorgeDenseff
Level 8

SIMPLE IRA Startup Costs Credit -

Most investment companies will not charge you a start-up fee for a simple IRA for a few employees.  There will be a yearly maintenance fee of $10 -$25 per employee per year.

Privacy Settings
v