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I need advise. I am covered by a pension plan at work, I contribute to a 401K max, and also $2000 to a ROTH IRA. My wife has a business of which I am a director. She has a SIMPLE IRA plan for herself and her employees. The compensantion I draw as a director I contribute to the SIMPLE IRA. Am I overcontributing to the IRA plans? Anyone with similar experiences or advise?
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Sounds good to me. You can have as many qualified plans as you have jobs and you can max them all out. Your 401k is from your primary job and maxing it out is no problem. your Roth IRA has nothing to do with the problem and is fine. As long as you qualify as an employee of your wifes company you can also participate in that plan to the max. Also note that your wifes plan must be a Simple sep ira that allows employees to join.
Robbdoe
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Sounds good to me. You can have as many qualified plans as you have jobs and you can max them all out. Your 401k is from your primary job and maxing it out is no problem. your Roth IRA has nothing to do with the problem and is fine. As long as you qualify as an employee of your wifes company you can also participate in that plan to the max. Also note that your wifes plan must be a Simple sep ira that allows employees to join.


Robbdoe, your wrong, the maximum a person can contribute to ALL employer sponsored plans is $10,000 for 1999, and $10,500 for 2000.

This person has a 401k and a Simple IRA. The maximum limit for the Simple is $6,000 and the maximum for the 401k is $10,500. If he is maxing out both the the 401k and the Simple is his over contributing.

He asked if he is over contributing to the IRA's. I guess that he don't know that the Simple IRA is an IRA in name only.

Also there is no sure thing as a "Simple sep ira".

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I stand corrected on the amounts a person can contribute to ALL qualified plans. That amount is 10k for 1999 and 10.5k for 2000.


I also want to say that there is a simple sep ira available and that is the plan that i thought he was talking about.(below is an excerpt from the FOOL)

A Simplified Employee Pension (SEP-IRA) is an IRA set up by an employer for a firm's employees. An employer may contribute up to $30,000 or 15% of an employee's compensation annually to each employee's IRA. (See SIMPLE).


A Savings Incentive Match Plan for Employees IRA (SIMPLE-IRA) is an IRA set up by a small employer for a firm's employees. Employees may contribute up to $6,000 per year to these IRAs and will receive some level of a matching percentage of pay from their employer. Between the employer and the employee, up to $12,000 may be contributed annually to the participant's account. (See SEP).


Once again I stand corrected and thank wallyjr for the help.
Robbdoe


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