Multiple SEP IRA’s

Submitted by michael steinebach on Mon, 2018-03-12 17:20

I would like to open a self directed SEP IRA. I currently have a SEP IRA with a broker. Could I have a SEP IRA with a broker and a self directed SEP IRA as well? As long as I stay within the IRS guidelines regarding maximum contributions, I would assume this would be okay?



Submitted by Alan - IRA critic on Mon, 2018-03-12 17:51

I assume you are self employed.  If so, do you have any other retirement plans for the business or entities under common control?



Submitted by michael steinebach on Mon, 2018-03-12 17:54

Yes.  I am self employed.  No other retirement plans besides my SEP IRA with a broker.  



Submitted by michael steinebach on Tue, 2018-03-13 18:37

Can I open a self directed SEP in addition to the brokered SEP?  



Submitted by William Tuttle on Tue, 2018-03-13 19:08

  • Just because you can do something, does not mean you should do something.
  • Be very aware of the rules on prohibited transactions, the consequences and the possibility they can happen beyond your control.
  • A significant percentage of self-directed retiremnt accounts engage in prohitibted transactions. Many beyond their control.
  • Of the collective group of people I know with self-dirceted retirement accouts. The vast majority have under performed the market.
  • Take your risks in your taxable accounts, not your retirement accounts.


Submitted by michael steinebach on Tue, 2018-03-13 19:39

Investing in the S&P 500 will not hurt me and will not be considered a prohibited transaction.   I just want to make sure I can index through my self directed sep whilte having a broker manage the rest.  This is all I’m asking.  



Submitted by Alan - IRA critic on Tue, 2018-03-13 20:56

Your last post is not clear. If you are only going to invest in an ordinary index fund, why open a self directed IRA at all?  The term “self directed” has two meanings. The broad meaning applies to almost all IRAs and refers to the fact that you can choose and direct your investments across a wide variety of publicly traded securities. The more specific meaning of “self directed” refers to a specialty custodian that allows you invest in such things as precious metals, real estate, privately held shares, or other non traditional investments. These are the accounts that are prone to prohibited transactions. Even if you wanted to use these kinds of investments you do not need to have your SEP contributions made directly to a self directed account. You could make all contributions to your current SEP and then rollover amounts you wanted to into the self directed IRA account, which would be set up as a non SEP traditional IRA account. Or maybe what you are looking for is to end your arrangement for management of your current SEP and just invest the contributions yourself.



Submitted by William Tuttle on Tue, 2018-03-13 23:12

As Alan pointed out “self-directed” has a certain connotation when posted here.



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