SIMPLE 401(k) Plans: Rules, Limits & How They Work
A retirement plan for small businesses with simpler administration and lower costs
SIMPLE 401(k) plans are designed for employers with 100 or fewer employees. Employee deferrals up to $16,500 (2025), with $3,500 catch-up for 50+ and $5,250 super catch-up for ages 60-63. Employers must match up to 3% or contribute 2% for all employees.
Key Features
- No nondiscrimination testing required
- Immediate vesting on all contributions
- Loans and hardship withdrawals allowed (unlike SIMPLE IRA)
- Employer must contribute: 3% match or 2% nonelective