IRA deposit when client has SEP at employer

Submitted by David Berka on Thu, 2014-10-30 21:15

If an owner/participant (age 56, $200,000 AGI, married filing jointly)has an existing SEP plan in place at his company, but chooses NOT to fund the SEP for 2014, can he make personal IRA contributions to the existing IRA accounts for both his spouse (not employed, not covered by an employer plan) and himself for 2014?



Submitted by Alan - IRA critic on Thu, 2014-10-30 22:46

  • He can certainly make a non deductible TIRA contribution, but I think you are asking about the deduction. They can both take the deduction if he is not an active participant according to this:   http://retirementdictionary.com/definitions/activeparticipant
  • Note that for a SEP IRA, he is an active participant in any year a contribution is actually made, regardless of which year it is for. Therefore, if a SEP contribution was made in 2014 for 2013, he is an active participant for 2014. This is also how his contributions are reported on Form 5498.

Add new comment

Log in or register to post comments