Amended schedule C and SEP contribution
A client contributed the maximum amount he could to a SEP in 2018 based upon his Schedule C self-employment earnings. We now need to amend his Schedule C and reduce his income. The reduction creates and excess SEP contribution for 2018. How do we correct the SEP over funding? Is he liable for a penalty?
Permalink Submitted by Alan - IRA critic on Wed, 2020-06-03 15:17
Was the 2018 contribution made in 2019? Has the 2019 contribution been made yet, and if so is there any room to apply the 2018 excess to 2019?
Permalink Submitted by Tim O'Neill on Wed, 2020-06-03 15:33
The contribution was made in 2019 but the client does not have any 2019 SE earnings nor does he anticipate any in future years.