Harris - SEP Plan

Small Business Banking

Simplified Employee Pension (SEP)

Who is eligible to participate?
(Employer)	Any type of public or private company or not-for-profit organization. Best suited for small, growing companies and organizations.
(Employee)	The plan may require that employees be at least 21 years old, perform service with the company 3 of the past 5 years, and earn at least $450 (indexed).

Who contributes? How much?	Employers may make discretionary contributions. Maximum amount of tax-deductible contributions is 25% of eligible compensation of all participants. Special contribution limit for sole proprietors and partnerships. Employee contributions are generally not applicable.

When are contributions vested?	Employer contributions are 100% vested at the time of contribution.

How can funds be accessed?	Withdrawals are permitted, but if made prior to age 59 ½ incur a 10% IRS premature distribution penalty, early withdrawal penalty, unless a permitted exception applies.* Loans are not permitted. Rollovers to another SEP plan or IRA are permitted.

What special administrative requirements are associated with the plan?	Nondiscrimination testing is not required. "Top-heavy" testing is required. Form 5500 and ERISA disclosures are generally not required.

When you are ready to establish your plan or if you still have questions, contact our Business Banking Service Center at 1-888-360-6445.

* Permitted exceptions include disability, death, and others. Please consult your tax advisor

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