Merrill Lynch P.O. Box 2016 Pennington, NJ 08701-9997 JOHN Q. CLIENT 1234 ANY STREET ANYTOWN, US 01234 Header 1 September XX, 2017 Page 1 of 3 SIMPLE IRA XXX-X2623 Review SIMPLE Plan Employee Notice Requirements for 2017 This notice is to advise you of important information regarding the SIMPLE Retirement Plan that you sponsor. Please be sure to read this notice in its entirety. If you are not the plan sponsor, please give this information to your employer. Our records indicate that you may have made contributions to one or more Merrill Lynch SIMPLE Retirement Accounts (SIMPLE IRAs) during 2017 for employees participating in your SIMPLE Plan. Therefore, as required by the Internal Revenue Code, we have enclosed the Merrill Lynch SIMPLE Retirement Account Summary Description for you to provide to your employees. Please read the following important information and instructions regarding the annual employee notice requirement, completion of the employer s Adoption Agreement and your opportunity to reduce the 3% match or make non-elective contributions for 2018 Employee notice requirement The annual election period under your SIMPLE Plan is November 2 through December 31, 2017. Prior to November 2, 2017, you are required to notify employees of their ability to begin making, or to modify existing, salary-reduction contributions under the plan. This notice must be accompanied by your SIMPLE Plan s Summary Description. You must provide each eligible employee the following materials before November 2: The Merrill Lynch SIMPLE Retirement Account Summary Description (draft enclosed, complete sections XI and XII) 1. A copy of your SIMPLE Plan (i.e., Merrill Lynch Prototype SIMPLE Retirement Account Plan Employer s Adoption Agreement, Form 5304-SIMPLE or other SIMPLE Plan). 2 If you are using the Merrill Lynch Prototype or Form 5304-SIMPLE and you wish to make changes to the Plan, you will need to complete a new Adoption Agreement or Form 5304-SIMPLE and provide a copy to your eligible employees. If needed, a Merrill Lynch Prototype SIMPLE Retirement Account Plan Employer s Adoption Agreement can be obtained by contacting your Merrill Lynch Financial Advisor. Sign and date the Adoption Agreement prior to distribution to employees and return it to the address listed on the agreement. The Merrill Lynch SIMPLE Retirement Account Program Employer Notice and Salary- Reduction Agreement (or your own form of employer notice and salary-reduction agreement). The Merrill Lynch SIMPLE Retirement Account Program Employer Notice and Salary-Reduction Agreement can be obtained by contacting your Merrill Lynch Code: 2017 SIMPLE Plan Notification SIMPLE01 08/2017 (ARTK4T3G) Information may appear on the back of this letter
Page 2 of 3 Financial Advisor, or download from our website at this address: http://ba.ml.com/sb/simplemailing.pdf. Alternatives to the 3% employer match for 2018 Each year, you are required to make dollar for dollar matching contributions of up to 3% of compensation for each employee making salary-reduction contributions under your SIMPLE Plan. You may, however, choose to reduce the contribution amount or make non-elective contributions to all eligible employees, provided, within a reasonable time before the annual election period, you notify each eligible employee of your decision to make one of the other permissible employer contributions for2018. 3 The other permissible contribution options are: Matching dollar-for-dollar each participant s salary-reduction contribution in an amount up to a percentage that is less than 3% of compensation (but not less than 1%). 4 Making a non-elective contribution on behalf of each employee who satisfies the requirements to receive such contribution (as specified in your SIMPLE Plan) equal to 2% of such employee s compensation. 5 IRS penalties If you do not provide eligible employees with the Employee Notice or Summary Description including any required attachments) before November 2, 2017, you will be subject to a penalty of $50 per day until the materials are provided. If you can show that the failure to provide the materials was due to reasonable cause, the penalty may not be imposed. Other information and resources If you have any additional questions about the employee notice requirement, completing the employer s Adoption Agreement or modifying the employer matching contribution, you can refer to the Merrill Lynch Prototype SIMPLE Employer s Guidebook. Please also consult your tax advisor to ensure that you are still eligible to maintain your SIMPLE Plan and that you are continuing to administer your plan in accordance with applicable requirements. When you have questions, you have options Please contact your Merrill Lynch Financial Advisor or call 1.800.MERRILL (1.800.637.7455). Code: 2017 SIMPLE Plan Notification SIMPLE01 08/2017 (ARTK4T3G)
Page 3 of 3 1 For eligible employees maintaining their SIMPLE IRAs with a financial institution other than Merrill Lynch, you must send the Summary Description you receive from that financial institution. 2 If you adopted some other form of SIMPLE plan, you must send eligible employees a copy of that SIMPLE plan and/or adoption agreement. 3 Remember for the current plan year, you must make your employer matching or non-elective contributions by your tax-filing deadline, plus extensions. 4 This contribution option is available only for two years during the five-year period ending with the current plan year. If any year in this five-year period is a year prior to the first year you (or a predecessor employer) maintained the SIMPLE Plan, you will be treated as if the level of your matching contributions was 3% for such prior year. 5 This contribution must be made regardless of whether such employee elects to make a salary-reduction contribution during the plan year. A compensation cap per employee applies when calculating the 2% nonelective contribution amount. The cap is $ 270,000for 2017and is indexed for inflation for later years. Merrill Lynch Wealth Management, Merrill Edge, and The Private Banking and Investment Group offer products and services made available through Merrill Lynch, Pierce, Fenner & Smith Incorporated (MLPF&S). Banking products are provided by Bank of America, N.A. and affiliated banks. Members FDIC and wholly owned subsidiaries of Bank of America Corporation. Investment products: Are Not FDIC Insured Are Not Bank Guaranteed May Lose Value MLPF&S is a registered broker-dealer, Member SIPC and a wholly owned subsidiary of Bank of America Corporation. Merrill Lynch, Bank of America, N.A. and their affiliates make available investment products sponsored, managed, distributed or provided by companies that are affiliates of Bank of America Corporation or in which Bank of America Corporation has a substantial economic interest, including BofA TM Global Capital Management. 2017 Bank of America Corporation. All rights reserved. Code: 2017 SIMPLE Plan Notification SIMPLE01 08/2017 (ARTK4T3G)
Merrill Lynch P.O. Box 2016 Pennington, NJ 08701-9997 JOHN Q. CLIENT 1234 ANY STREET ANYTOWN, US 01234 Header 1 September XX, 2016 Page 1 of 3 SIMPLE IRA XXX-X2623 Review SIMPLE Plan Employee Notice Requirements for 2017 This notice is to advise you of important information regarding the SIMPLE Retirement Plan that you sponsor. Please be sure to read this notice in its entirety. If you are not the plan sponsor, please give this information to your employer. Our records indicate that you may have made contributions to one or more Merrill Lynch SIMPLE Retirement Accounts (SIMPLE IRAs) during 2017 for employees participating in your SIMPLE Plan. Therefore, as required by the Internal Revenue Code, we have enclosed the Merrill Lynch SIMPLE Retirement Account Summary Description for you to provide to your employees. Please read the following important information and instructions regarding the annual employee notice requirement, completion of the employer s Adoption Agreement and your opportunity to reduce the 3% match or make non-elective contributions for 2018. Employee notice requirement The annual election period under your SIMPLE Plan is November 2 through December 31, 2017. Prior to November 2, 2017 you are required to notify employees of their ability to begin making, or to modify existing, salary-reduction contributions under the plan. This notice must be accompanied by your SIMPLE Plan s Summary Description. You must provide each eligible employee the following materials before November 2: The Merrill Lynch SIMPLE Retirement Account Summary Description (draft enclosed, complete sections XI and XII). A copy of your SIMPLE Plan (i.e., Merrill Lynch Prototype SIMPLE Retirement Account Plan Employer s Adoption Agreement, Form 5304-SIMPLE or other SIMPLE Plan). 2 If you are using the Merrill Lynch Prototype or Form 5304-SIMPLE and you wish to make changes to the Plan, you will need to complete a new Adoption Agreement or Form 5304-SIMPLE and provide a copy to your eligible employees. If needed, a Merrill Lynch Prototype SIMPLE Retirement Account Plan Employer s Adoption Agreement can be obtained by contacting your Merrill Lynch Financial Advisor. Sign and date the Adoption Agreement prior to distribution to employees and return it to the address listed on the agreement. The Merrill Lynch SIMPLE Retirement Account Program Employer Notice and Salary- Reduction Agreement (or your own form of employer notice and salary-reduction agreement). The Merrill Lynch SIMPLE Retirement Account Program Employer Notice and Salary-Reduction Agreement can be obtained by contacting your Private Wealth Code: 2017 SIMPLE Plan Notification SIMPLE01 09/2017 (ARTK4T3G) Information may appear on the back of this letter
Page 2 of 3 Advisor, or download from our website at this address: http://ba.ml.com/sb/simplemailing.pdf. Alternatives to the 3% employer match for 2018 Each year, you are required to make dollar for dollar matching contributions of up to 3% of compensation for each employee making salary-reduction contributions under your SIMPLE Plan. You may, however, choose to reduce the contribution amount or make non-elective contributions to all eligible employees, provided, within a reasonable time before the annual election period, you notify each eligible employee of your decision to make one of the other permissible employer contributions for 2018. 3 The other permissible contribution options are: Matching dollar-for-dollar each participant s salary-reduction contribution in an amount up to a percentage that is less than 3% of compensation (but not less than 1%). 4 Making a non-elective contribution on behalf of each employee who satisfies the requirements to receive such contribution (as specified in your SIMPLE Plan) equal to 2% of such employee s compensation. 5 IRS penalties If you do not provide eligible employees with the Employee Notice or Summary Description including any required attachments) before November 2, 2017, you will be subject to a penalty of $50 per day until the materials are provided. If you can show that the failure to provide the materials was due to reasonable cause, the penalty may not be imposed. Other information and resources If you have any additional questions about the employee notice requirement, completing the employer s Adoption Agreement or modifying the employer matching contribution, you can refer to the Merrill Lynch Prototype SIMPLE Employer s Guidebook. Please also consult your tax advisor to ensure that you are still eligible to maintain your SIMPLE Plan and that you are continuing to administer your plan in accordance with applicable requirements. When you have questions, you have options Please contact your Private Wealth Advisor or call 1.800.MERRILL (1.800.637.7455). Code: 2017 SIMPLE Plan Notification SIMPLE01 09/2017 (ARTK4T3G)
Page 3 of 3 1 For eligible employees maintaining their SIMPLE IRAs with a financial institution other than Merrill Lynch, you must send the Summary Description you receive from that financial institution. 2 If you adopted some other form of SIMPLE plan, you must send eligible employees a copy of that SIMPLE plan and/or adoption agreement. 3 Remember for the current plan year, you must make your employer matching or non-elective contributions by your tax-filing deadline, plus extensions. 4 This contribution option is available only for two years during the five-year period ending with the current plan year. If any year in this five-year period is a year prior to the first year you (or a predecessor employer) maintained the SIMPLE Plan, you will be treated as if the level of your matching contributions was 3% for such prior year. 5 This contribution must be made regardless of whether such employee elects to make a salary-reduction contribution during the plan year. A compensation cap per employee applies when calculating the 2% nonelective contribution amount. The cap is $270,000 for 2017 and is indexed for inflation for later years. Merrill Lynch Wealth Management, Merrill Edge, and The Private Banking and Investment Group offer products and services made available through Merrill Lynch, Pierce, Fenner & Smith Incorporated (MLPF&S). Banking products are provided by Bank of America, N.A. and affiliated banks. Members FDIC and wholly owned subsidiaries of Bank of America Corporation. Investment products: Are Not FDIC Insured Are Not Bank Guaranteed May Lose Value MLPF&S is a registered broker-dealer, Member SIPC and a wholly owned subsidiary of Bank of America Corporation. Merrill Lynch, Bank of America, N.A. and their affiliates make available investment products sponsored, managed, distributed or provided by companies that are affiliates of Bank of America Corporation or in which Bank of America Corporation has a substantial economic interest, including BofA TM Global Capital Management. 2017 Bank of America Corporation. All rights reserved. Code: 2017 SIMPLE Plan Notification SIMPLE01 09/2017 (ARTK4T3G)