Which of the following retirement plans will allow for a nonworking spouse to set up a separate account and make contributions based on the working spouse's income?

A SIMPLE IRA (Savings Incentive Match Plan for Employees) is designed primarily for small businesses and self-employed individuals. It allows contributions from employees but does not specifically cater to nonworking spouses making contributions based on their partner’s income. Contributions must come from the employee or employer, which limits the flexibility for nonworking spouses.

A SEP IRA (Simplified Employee Pension) is also aimed at self-employed individuals and small business owners. It allows contributions from the employer only, meaning that a nonworking spouse cannot set up their own account based on the working spouse’s income. This plan is structured around employer contributions rather than allowing individual retirement accounts for nonworking spouses.

A 401(k) plan is typically employer-sponsored and focused on employee contributions, often with employer matching. While a working spouse can contribute to a 401(k), it does not allow a nonworking spouse to create a separate account based on the working spouse's income. Thus, it does not facilitate spousal contributions in the same way an IRA does.