Announcements

September 16, 2024

Introducing Roth employee deferrals for SIMPLE IRAs

SIMPLE IRA Plus and SIMPLE IRA plan sponsors can offer participants a new way to save for retirement by adding Roth after-tax deferral contributions. This optional plan feature is available now for new SIMPLE IRA Plus plans and available effective January 1, 2025, for new SIMPLE IRA Plans. Existing SIMPLE IRA Plus and SIMPLE IRA plans can add this feature effective January 1, 2025.

To offer Roth employee deferrals:

  • New plans must select both pre-tax and Roth employee deferrals on the adoption agreement and the Notification to Eligible Employees disclosure document.
  • Existing plans must amend their adoption agreement prior to November 2, 2024, and notify participants of this change prior to the annual enrollment period, which will run from November 2, 2024, through December 31, 2024. Learn more about amending SIMPLE IRA and SIMPLE IRA Plus plans.


In our annual notification to existing plan sponsors of their disclosure documents, we include the steps to add this optional feature to their plan and notify participants.

Please visit our account resource center for additional assistance with your SIMPLE IRA Plus plans. You can also learn more about the status of our support for SECURE 2.0 provisions.

Frequently asked questions

General

  • What’s driving the availability of Roth for SIMPLE IRAs?
  • Section 601 of SECURE 2.0 Act of 2022 allows plans to offer Roth employee and employer contributions for SIMPLE IRAs and SEP IRAs.
  • What’s Capital Group’s plan for introducing Roth contributions to SIMPLE IRA plans? 
  • We plan to introduce Roth employee deferrals to SIMPLE IRA plans starting January 1, 2025, and began offering it to SIMPLE IRA Plus earlier this year.

SIMPLE IRA Plus

  • What’s required for plans to offer Roth employee deferrals? 
  • New plans must select Roth employee elective deferrals in their plan adoption agreement.
  • Existing plans must amend and restate their adoption agreement prior to November 2 and notify participants of this change prior to the annual enrollment period from November 2 through December 31. We’ll share more information with plan sponsors, including the required steps to add a Roth option to an existing plan, later this year.

Note: All employer contributions must be made on a pre-tax basis at this time.

  • Are plans required to offer Roth employee deferrals contributions?
  • No, this is an optional plan feature.
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