If you’re a small business owner or self employed, a Simplified Employee Pension Plan (SEP) may help you get the tax-deferred benefit you need to grow your retirement savings.
Individuals who are eligible to establish a SEP and have eligible employees establish SEP IRAs include:
The establishment deadline is the same as the federal income tax return filing deadline for any given year, usually April 15.
SEP contributions must be made by the employer.
Employers may contribute until the business tax filing deadline for the year, including extensions.
Catch-up contributions are not allowed with the exception of IRAs that hold the SEP contributions if the SEP IRA documents allow.
Contributions are tax deferred to employees and tax deductible as a business expense.
The distribution rules for SEP assets are similar to those of a Traditional IRA.