SIMPLE IRA Employee FAQs

How do I participate in a T. Rowe Price SIMPLE IRA?

Your employer will give you the proper forms to fill out and materials to explain the details of the SIMPLE IRA plan the company has chosen. It takes just a few minutes to open a SIMPLE IRA. Please review the T. Rowe Price SIMPLE IRA Disclosure Statement and Custodial Agreement before completing the Participant Account form.

Who controls my SIMPLE IRA account?

You do. Your employer may direct SIMPLE IRA contributions to your T. Rowe Price SIMPLE IRA, but these contributions become your property when they are deposited in your SIMPLE IRA. The contributions are immediately 100% vested. The money must stay in a SIMPLE IRA for two years from your initial SIMPLE IRA participation date or a 25% additional tax for early withdrawal may be assessed upon withdrawal. After two years, the normal IRA distribution rules apply (i.e., if you withdraw before you reach age 59½, you may incur a 10% additional tax for early withdrawal).

What if I do not want a SIMPLE IRA account?

Your employer may enroll eligible employees in a SIMPLE IRA and make employer contributions into a SIMPLE IRA on your behalf. Employees are under no obligation to contribute through salary deduction if they do not want to do so.

May I participate in a SIMPLE IRA if I am in another retirement plan sponsored by another employer?

Yes. If you work for more than one employer, you may also participate in another retirement plan in addition to the T. Rowe Price SIMPLE IRA, but certain contribution limits among the plans may be applicable.

May SIMPLE IRA contributions from my employer be deposited into my spouse's IRA account?

No. SIMPLE IRA contributions may be deposited only in the employee's SIMPLE IRA.

What costs are involved with a SIMPLE IRA plan?

There is a $20 account service fee for each T. Rowe Price mutual fund account with a balance below $10,000 in your SIMPLE IRA. The $20 account service fee will be waived for the following circumstances: Subscribe to electronic delivery of statements and confirmations*; 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 the T. Rowe Price Summit Program. If the 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.

*Participant can subscribe to paperless delivery via the T. Rowe Price website once their account is established.

Are all employees eligible to participate in a SIMPLE IRA plan?

Generally, any employee who has earned at least $5,000 during any two prior years and who is expected to earn $5,000 in the current year must be eligible to participate in a SIMPLE IRA plan. However, your employer may choose to exclude certain union employees and nonresident aliens. Refer to information from your employer, such as your copy of the SIMPLE IRA plan document, for the rules specific to your plan.

How much can I contribute to my SIMPLE IRA?

Up to $16,500 for 2025 and $17,000 in 2026, in elective deferrals. This amount will be adjusted to reflect any cost-of-living increases announced by the IRS. In addition, catch-up contributions for individuals aged 50 or older may be made, up to $3,500 for 2025 and $4,000 for 2026, respectively; for individuals ages 60-63, catch-up contributions may be made at a higher amount, up to $5,250 for 2025 and 2026.
 

Is my employer required to contribute to my SIMPLE IRA?

Yes, your employer must make either matching or nonelective contributions each year. Your employer must notify you of the contribution type and the contribution percentage prior to your initial eligibility and at the beginning of each annual 60-day election period (the 60 days during which you may enter into or modify your salary reduction agreement for the following year).
 

How much can my employer contribute to my SIMPLE IRA using matching contributions?

Your employer may match 100% of your salary deferrals, up to the first 3% of your compensation.

An employer may also elect to match a lower percentage, as long as it is not lower than 1% of your compensation. This option is only allowed in two years of any five consecutive years. Those employers who match below 3% must notify their employees of the lower matching percentage prior to the 60-day election period beginning before the plan year in which the match will be below 3%.
 

How much can my employer contribute to my SIMPLE IRA using nonelective contributions?

Up to 2% of compensation. No more than $350,000 in compensation for 2025 and $360,000 for 2026 can be taken into account when determining the nonelective contribution for each employee.
 

May I combine my regular IRA contributions with SIMPLE IRA contributions from my employer?

No. Your T. Rowe Price SIMPLE IRA may include only your employer's contributions and your own salary deferrals.

When will my employer contribute to my SIMPLE IRA?

Your employer must remit your salary reduction contributions to the SIMPLE IRA no later than the end of the 30-day period after the end of the month in which you normally would have received that money in your paycheck. Employer contributions to your SIMPLE IRA may be made in periodic contributions or in a single lump sum, as long as the contributions are deposited before the employer's tax return filing deadline (including extensions).
 

May I stop contributing to my SIMPLE IRA?

Yes. You are permitted to stop contributing at any time by properly notifying your employer. Your plan may require that you wait until the beginning of the next calendar year to resume contributions. Refer to information from your employer, such as your copy of the SIMPLE IRA plan document, for the rules specific to your plan.

How are my SIMPLE IRA contributions invested?

You choose how you want to invest SIMPLE IRA plan contributions made by your employer. In a T. Rowe Price SIMPLE IRA, you can select from over 150 different stock, bond, and money market mutual fund investment options. Additional information on any T. Rowe Price mutual fund may be obtained from downloading the fund prospectus.

How do I withdraw assets from my T. Rowe Price SIMPLE IRA account?

To withdraw assets, contact T. Rowe Price at 1-800-492-7670 or at P.O. Box 17350, Baltimore, MD 21297-17350. Please note that if you have not yet reached age 59½ and no exception applies, you may be subject to a 10% penalty. This penalty may be increased to 25% if you withdraw money from your SIMPLE IRA during the first two years of your participation in the plan.
 

May I take a loan from my account?

No, loans are not permitted from a SIMPLE IRA.

How do I transfer assets from my account?

Your right to transfer amounts out of your account is discussed in the summary description materials provided by your employer.

Do I need to file any additional forms with the IRS because I participate in the SIMPLE IRA plan?

No. Your employer is responsible for adjusting your Form W-2 to reflect your salary reduction contributions to the plan.

Are SIMPLE IRA contributions currently taxable?

No. Your salary deferral contributions are considered pretax contributions and are not included in your gross income. Neither employer nor salary deferral contributions are taxable until withdrawn from the plan.

What information must my employer provide to me?

Your employer must provide the following information in writing to all eligible employees, prior to each employee's initial eligibility date and prior to the 60-day election period preceding the beginning of each calendar year:

• Notification of the opportunity to initiate or change salary reduction elections.
• Notification of the type of employer contributions that will be made (i.e., 1% to 3% matching contribution or a 2% nonelective contribution).
• A summary description of the SIMPLE IRA plan.

What information will T. Rowe Price provide?

T. Rowe Price will provide:

• A prospectus for each fund selected;
• Distribution or withdrawal information;
• A quarterly statement; and
• Periodic fund information.