Only employers with fewer than 100 employees can open these plans and annual contributions are limited to $13,500. There is a $3,000 catch-up contribution allowed for workers over age 50. Unlike SEP IRAs, both employers AND employees can contribute to this plan. Employers will either contribute a flat 2% (regardless of an employee’s contribution) of the employee’s wages OR 3% matching contribution. The SIMPLE IRA works most like a 401k, but is less costly and easier to administer than a 401k.