Milberg Consulting

The chart below illustrates the benefits and features that are available for the plan types shown. This chart is intended as a guide only. Be mindful that many of the features shown below indicate the maximum parameters under which they may apply or operate (e.g., participant eligibility conditions, employer contribution vesting schedule). The extent to which you may wish to apply the available parameters depends on the employer/plan sponsor's individual facts and circumstances. We suggest that you consult a pension professional before selecting to include or exclude any specific benefit or feature in your plan. Access to additional information on the specific benefit or feature is underlined in blue

Benefit or Feature	SEP	SIMPLE IRA	SIMPLE 401(k)	Qualified Retirement Plan
Benefit or Feature	SEP	SIMPLE IRA	SIMPLE 401(k)	Profit Sharing (PS)	PS w/401(k)	Defined Benefit
Maximum Participant Eligibility Conditions	Any year earning $450 in 3 of prior 5 years (2005 limit)	$5,000 in 2 prior; $5,000 expected in current year	Age 21; 1 year of service (1,000 hrs.)	Age 21; 2 years of service (1,000 hrs.)	Age 21; 1 year of service (1,000 hrs.) for 401(k) only	2 years of service (1,000 hours); Age 21
Maximum Elective Employee Contribution (IRC §402(g))	Not Applicable	Lesser of 100% of compensation or $10,000 (2005)	Lesser of 100% of compensation or $10,000 (2005)	Not Applicable	Lesser of 100% of compensation or $14,000 (2005)	Not Applicable
Catch-up (age 50+)	None	$2,000 (2005)	$2,000 (2005)	None	$4,000 (2005)	None
Employer Match	Not Applicable	Required: 100% of 1st 3% (may reduce to 1% in 2 of 5 yrs)	Required: 100% of 1st 3% (may not reduce)	Not Applicable	May be fixed or discretionary	Not Applicable
Employer Contribution	Discretionary	Required: 2% of Total Compensation	Required: 2% of Total Compensation	Discretionary but may require Top-heavy minimum contribution	Discretionary but may require Top-heavy minimum contribution	Required contribution based on plan formula
Employer Contribution Allocation or Benefit Determination Methods	Salary Proportionate; Integrated with S.S. (not available with IRS Model SEP)	Salary Proportionate	Salary Proportionate	Salary Proportionate; Integrated w/S.S.; class or age-based	Salary Proportionate; Integrated w/S.S.; class or age-based	Fixed Benefit; Unit Benefit; Class-based; Cash Balance
"Safe Harbor" 401(k) Automatic Pass of ADP/ACP Test	Not Applicable	Not Applicable	Not Applicable	Not Applicable	Required 100% vested 3% employer cont. or match equal to 100% of 1st 3%, 50% of next 2%	Not Applicable
Maximum Vesting for Employer Contributions	100% Immediate	100% Immediate	100% Immediate	3/20 graded or 5 year cliff	Employer match: 2/20 graded or 3 year cliff	3/20 graded or 5 year cliff
Withdrawals	Penalty free after age 59½ or Death	Penalty free after age 59½ or Death	Penalty free after age 59½ or Death	Retirement, Death or Disability, In-Service, Hardship (may be subject to add'l tax)	Retirement, Death or Disability, In-Service, Hardship (may be subject to add'l tax)	Retirement, Death or Disability, In-Service, Hardship (may be subject to add'l tax)
Participant Loans	Not Permitted	Not Permitted	Not Permitted	Permitted within Limits	Permitted within Limits	Permitted within Limits
Last Day of Plan Year Employment Condition	Not Permitted	Not Permitted	Not Permitted	Permitted but subject to minimum coverage rules	Permitted but subject to minimum coverage rules	Permitted but subject to minimum coverage rules
Participant-Directed Investments	Required	Required	Required	Optional but not required	Optional but not required	Not Permitted
Life Insurance as a Plan Investment	Not Permitted	Not Permitted	Not Permitted	Permitted	Permitted	Permitted
Accepts transfer from qualified plan, IRA, SEP, SIMPLE, 403(b), 457(b)	Yes; SIMPLE IRA 25% penalty if distributed before 2 years	From another SIMPLE IRA only	Yes; SIMPLE IRA 25% penalty if distributed before 2 years	Yes; SIMPLE IRA 25% penalty if distributed before 2 years	Yes; SIMPLE IRA 25% penalty if distributed before 2 years	Yes; SIMPLE IRA 25% penalty if distributed before 2 years

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We intend the information in this publication as a general resource, not as legal or plan design advice or counsel. Before you include or exclude any benefits or features shown above in your plan, we suggest that you consult a tax or ERISA professional. Milberg Consulting LLC and Barry R. Milberg do not warrant and are not responsible for any errors and omissions from this information.