Calculate employee deferrals and employer contributions for a standard SIMPLE IRA using current federal limits and compare the 3% match with the 2% nonelective formula.
The SIMPLE IRA Contribution Calculator helps employees and small-business owners estimate standard SIMPLE IRA contributions for the current plan year. SIMPLE IRAs are designed for employers with 100 or fewer employees and combine employee salary deferrals with either a 3% employer match or a 2% nonelective contribution.
For the standard 2026 SIMPLE IRA limit, employee deferrals are capped at $17,000. The age-50+ catch-up amount is $4,000, and the ages-60-to-63 catch-up amount is $5,250. This page models those standard limits and compares the result with rough 401(k), SEP IRA, and regular IRA planning ranges.
Some applicable SIMPLE plans can permit higher limits than the standard amounts. This page does not model those enhanced-plan variants, so it works best as a planning worksheet for the standard SIMPLE structure.
This page helps you see how much of the annual total comes from the employee side and how much comes from the employer formula. It is especially useful for small employers deciding between the 3% match and 2% nonelective structure for budgeting purposes.
Employee Deferral = min(Compensation × Deferral%, $17,000 + applicable catch-up) Catch-Up (50+): $4,000 | Ages 60-63: $5,250 3% Match: min(Employee Deferral, Compensation × 3%) 2% Non-Elective: Compensation × 2% (regardless of employee contribution) Total = Employee Deferral + Employer Contribution
Result: Employee: $21,000 | Employer: $3,000 (3% match) | Total: $24,000
At age 52 with $100,000 of compensation and a 25% elected deferral rate, the page caps the employee contribution at the 2026 standard SIMPLE limit plus the age-50+ catch-up, for a total of $21,000. A 3% match contributes another $3,000, for a combined annual total of $24,000.
SIMPLE IRAs remain attractive because they avoid most of the testing and administration burden that comes with a 401(k). Each employee owns an individual IRA, the employer picks the match or nonelective formula, and there is no annual Form 5500 for the SIMPLE plan itself.
The 3% match costs less when some employees choose not to contribute, while the 2% nonelective formula spreads employer dollars more evenly across all eligible employees. The better option depends on workforce participation patterns more than on one universal rule.
SECURE 2.0 allows some employers to offer higher SIMPLE limits than the standard amount. This page intentionally sticks to the standard SIMPLE structure because the enhanced design is not available in every plan and often depends on employer size and plan setup.
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This page calculates the employee deferral as the lesser of compensation times the selected deferral rate or the standard 2026 SIMPLE IRA limit plus the applicable catch-up amount. It then applies either a dollar-for-dollar 3% match or a 2% nonelective employer contribution and totals the two components.
The page models the standard SIMPLE IRA limits only. It does not model enhanced applicable SIMPLE limits, plan-specific Roth SIMPLE design choices, or every employer eligibility rule in detail. The 401(k), SEP IRA, and regular IRA rows are planning comparisons rather than full legal-plan calculations.
For the standard 2026 SIMPLE IRA limit, the employee deferral cap is $17,000. Those age 50 or older can add a $4,000 catch-up, and participants age 60 through 63 can use a $5,250 catch-up. Employer contributions still follow either the 3% match or 2% nonelective formula.
The 3% match only contributes when the employee defers, up to 3% of compensation. The 2% nonelective contribution is made for eligible employees even if they do not contribute themselves.
A 401(k) generally allows higher employee deferrals and more design flexibility. For 2026, the standard 401(k) employee deferral limit is $24,500 versus $17,000 for a standard SIMPLE IRA. SIMPLE IRAs are usually cheaper and easier to administer, which is why they remain popular with very small employers.
Yes. The SIMPLE IRA does not replace your regular IRA entirely, but different deductibility and coordination rules can still apply depending on your tax situation.
It works best as a standard SIMPLE IRA planning worksheet for employees and for very small employers estimating the effect of the two employer-contribution formulas.
No. The page intentionally models the standard SIMPLE IRA limits. Some applicable SIMPLE plans can offer higher limits, but that depends on plan design and employer status.