SEP employee payroll deductions
With a SEP plan, can the employer make arrangements with the employee whereby the employer withholds “X” amount from the employees paycheck and uses it to make an employer SEP contribution?
With a SEP plan, can the employer make arrangements with the employee whereby the employer withholds “X” amount from the employees paycheck and uses it to make an employer SEP contribution?
Permalink Submitted by Alan - IRA critic on Fri, 2013-03-22 19:21
No, that would be a salary reduction contribution, and the only type of SEP that currently allows that is an on going SARSEP established prior to 12/31/1996. A typical SEP IRA now is not a salary reduction plan and the employer must make contributions to the employee SEP IRA without reducing salary.