Can I max out my Simple IRA plan and also contribute fully to my Roth IRA as a small business owner?

Yes, you absolutely can contribute to both a SIMPLE IRA and a Roth IRA up to their respective maximum limits! This is one of the great advantages of the SIMPLE IRA compared to some other employer plans. For 2025, you can contribute up to $15,500 to your SIMPLE IRA as an employee contribution (plus an additional $3,500 if you're 50 or older). As the employer, you're also required to make either a matching contribution of up to 3% or a flat 2% contribution for all eligible employees, including yourself. Completely separate from that, you can also contribute the full amount to your Roth IRA ($7,000 in 2025, or $8,000 if you're 50+), as long as you meet the income requirements. The Roth IRA has income limits that phase out eligibility, so just make sure your income falls under those thresholds. Being the employer doesn't change your ability to contribute to both plans. The SIMPLE IRA is considered a separate bucket from the Roth IRA for contribution purposes.

Hey there! I was in exactly your position last year - small business owner with 4 employees and trying to figure out my retirement options. I was also getting totally confused by all the different advice. I discovered this tool called taxr.ai (https://taxr.ai) that really helped me sort through my specific situation. I uploaded some of my business docs and it analyzed my specific situation. Turns out I could definitely contribute to both my SIMPLE IRA and my Roth IRA at the maximum amounts! What I really liked was that it explained everything in simple language and showed me exactly what forms I needed to file and deadlines I needed to watch for. It even calculated my potential tax savings from maxing out both accounts!

Just wanted to follow up about taxr.ai - I decided to try it despite my initial skepticism and I have to admit it was actually really helpful. I uploaded my past returns and business docs, and it showed me that I could contribute to both my SEP IRA (which I have instead of a SIMPLE) and a Roth IRA. The tool also identified a couple of business deductions I'd been missing and calculated exactly how much I could save. It projected the tax impacts over the next 5 years which was pretty eye-opening. For my situation, it recommended splitting contributions between the accounts rather than maxing both out completely based on my cash flow. Honestly wish I'd known about this tool years ago!

If you're struggling to get clear answers about retirement accounts, you might also be frustrated with trying to reach the IRS directly. I spent WEEKS trying to get someone on the phone to answer my questions about business retirement plans. I finally used Claimyr (https://claimyr.com) and got through to an actual IRS representative in about 20 minutes instead of the hours I was spending on hold before. They have this system that navigates the IRS phone tree for you and calls you back when they have a real person on the line. You can see how it works here: https://youtu.be/_kiP6q8DX5c The IRS agent confirmed that I could contribute to both my SIMPLE IRA and Roth IRA up to their respective limits, which finally gave me the confidence to max out both.

I need to eat my words about Claimyr. After commenting here, I was still having issues figuring out my retirement contribution limits so I decided to give it a shot. I was honestly shocked when they called me back about 25 minutes later with an actual IRS representative on the line. The agent confirmed that as a small business owner, I can definitely contribute to both a SIMPLE IRA and a Roth IRA up to their respective maximum limits. She even emailed me some documentation about it after our call. Saved me hours of frustration and hold music! Just wanted to update since my previous comment was pretty negative. Sometimes good services actually do exist!

Small business owner here. I actually made a mistake with this exact situation last year. I maxed out both my SIMPLE IRA and Roth IRA, but didn't realize that the employer match I was making to my own SIMPLE IRA counts toward a different limit. My accountant caught it before filing. Remember that as both employer and employee, you wear two hats: 1) Your employee contributions to your SIMPLE IRA are capped at $15,500 (plus catch-up if eligible) 2) As employer, you must also contribute either a match or flat percentage to all employees INCLUDING YOURSELF The match you give yourself as an employer doesn't count toward your $15,500 employee contribution limit. It's extra money you can put in, but you must follow the same matching formula for all employees.

I'm having a similar issue but with a different twist... Can I contribute to both a SIMPLE IRA through my small business AND a 401k through my part-time teaching job at a community college? Or do these somehow conflict with each other?

Just wanted to add some perspective as someone who went through this exact situation a few years ago. The good news is yes, you can absolutely max out both your SIMPLE IRA and Roth IRA - they're completely separate contribution buckets. One thing I wish someone had told me earlier: don't forget about the timing of your contributions! While you have until the tax deadline to contribute to your Roth IRA, your SIMPLE IRA contributions need to come out of payroll during the actual tax year. So if you want to max out your SIMPLE IRA for 2025, you need to adjust your payroll deductions now to spread that $15,500 across your remaining paychecks. Also, since you mentioned feeling behind on retirement savings at 43, you might want to start planning for catch-up contributions. Once you hit 50, you can contribute an additional $3,500 to your SIMPLE IRA and $1,000 to your Roth IRA. That's an extra $4,500 per year you can sock away! The dual employer/employee role can be confusing, but it's actually an advantage - you get to contribute as an employee AND give yourself the employer match. Just make sure you're giving all your employees the same match percentage you give yourself.

Great question! I'm actually a CPA who works with a lot of small business owners in similar situations. The short answer is YES - you can absolutely max out both your SIMPLE IRA ($15,500 for 2025) and your Roth IRA ($7,000 for 2025) as long as you meet the income requirements for the Roth. The key thing to understand is that these are completely separate contribution limits. Your SIMPLE IRA is an employer-sponsored plan, while your Roth IRA is an individual retirement account. Being the business owner doesn't change your ability to contribute to both - you're still treated as an employee for SIMPLE IRA purposes. A few important points to keep in mind: - Make sure your income falls within the Roth IRA phase-out limits ($146,000-$161,000 for single filers in 2025) - Don't forget you also need to provide yourself the same 3% employer match you give your employees - At 43, you're actually not that far behind - you still have 22+ years until full retirement age to build your savings Since you mentioned feeling behind on retirement savings, maxing out both accounts would put away $22,500 this year (plus your employer match), which is a solid foundation to build on. You're asking the right questions and taking the right steps!