Skip to: Main Navigation
Skip to: Content



SEP IRAs

SEP IRAs

Home » Tax Center » Tax Tips » SEP IRAs

SEP IRAs

A "Simplified Employee Pension IRA" is a tax-deferred retirement plan provided by sole proprietors or small businesses, most of which don't have any other retirement plan. Contributions are made by the employer, and unlike the traditional IRA, can be as high as 25% of each employee's total compensation, with a maximum contribution of $46,000 (subject to adjustments for inflation after 2008). For a sole proprietor, this can be a significant opportunity to save for retirement on a tax-deferred basis. Employees with SEP-IRAs can also invest in regular IRAs.

Aside from the higher contribution limits, SEP-IRAs are subject to the same rules as a regular IRA. Contributions and the investment earnings can grow tax-deferred until withdrawal (assumed to be retirement), at which time they are taxed as ordinary income.

News and Events

Are you Next? New Audit Targets

Are you Next? THE IRS’s NEW AUDIT TARGETS

The Internal Revenue Service (IRS) is stepping up enforcement this year...

More »

Diversify your Investments

Four Steps to Diversify your Investment Mix

Are you confident that your investment portfolio is properly diversified?

More »

 

Tax Center

  • 1.
  • 2.
  • 3.

Go To Tax Center »