Permalink Submitted by Denise Appleby on Thu, 2008-04-03 02:50
Yes . You can start a SEP IRA. Alternatively, you can [i]upgrade [/i]the traditional IRA to a SEP IRA and make both your traditional IRA and SEP IRA contribution to the same account. Both contributions would be identified separately on your 5498.
You can establish a SEP Plan only if you have you own business, and the contributions you make to the SEP will be based on the income you receive from the business.
If you do not own your own business, but work for a business that offers a SEP IRA to its employees, you can open your SEP IRA under the plan, to receive SEP contributions made by your employer.
Your SEP contribution does not affect the amount you can contribute to your IRA and vice-versa. However, you are considered an active participant for the year that your SEP contribution is deposited to your SEP IRA and that could affect your eligibility for deducting your traditional IRA contribution. See http://www.retirementdictionary.com/active-participant.htm
SEP IRA contributions are deductible on the business’ tax return
Permalink Submitted by Denise Appleby on Thu, 2008-04-03 02:50
Yes . You can start a SEP IRA. Alternatively, you can [i]upgrade [/i]the traditional IRA to a SEP IRA and make both your traditional IRA and SEP IRA contribution to the same account. Both contributions would be identified separately on your 5498.
You can establish a SEP Plan only if you have you own business, and the contributions you make to the SEP will be based on the income you receive from the business.
If you do not own your own business, but work for a business that offers a SEP IRA to its employees, you can open your SEP IRA under the plan, to receive SEP contributions made by your employer.
Your SEP contribution does not affect the amount you can contribute to your IRA and vice-versa. However, you are considered an active participant for the year that your SEP contribution is deposited to your SEP IRA and that could affect your eligibility for deducting your traditional IRA contribution. See http://www.retirementdictionary.com/active-participant.htm
SEP IRA contributions are deductible on the business’ tax return