"Will" wrote:

- quote -

Yes. That's a salary deferral limit. Employer contributions are allowed on
top of that.

See IRS Publication 525.

--
Phil Marti
Clarksburg, MD

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In 2007 and 2008, an employee who participates in a Simple IRA plan may
contribute up to a maximum of $10.5K to the plan, and $13K if they are over
50. Are these limits all calculated prior to adding in the employer
contribution of 3% dollar-for-dollar? If yes, the employer contribution
might push them over the $10.5K limit. I want to make sure the employee
doesn't need to back out the the employer contribution when calculating
their own contribution.

--
Will

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >