Eligibility Requirements for SIMPLE IRAsEmployees (including self-employed individuals who received earned income) must be allowed to participate in their employer's SIMPLE plan if they:
- Received at least $5,000 in compensation from the employer during any two years prior to the current year, and
- Are reasonably expected to receive at least $5,000 in compensation during the calendar year for which contributions are made.
An employer may exclude from eligibility the following:
- Employees whose retirement benefits are covered by a union contract
- Employees who are nonresident aliens and received no earned income from sources within the United States
- Employees who would not have been eligible employees if an acquisition, disposition, or similar transaction had not occurred during the year