What Year is SEP Deducted?
Hello-
If a corporation taxed as S Corp sets up a new SEP IRA, now and makes a contribution for 2020 they will deduct the contribution on their 2020 tax return correct?
Thank you!
Hello-
If a corporation taxed as S Corp sets up a new SEP IRA, now and makes a contribution for 2020 they will deduct the contribution on their 2020 tax return correct?
Thank you!
Permalink Submitted by Alan - IRA critic on Tue, 2021-03-16 17:38
Yes, the SEP contribution is reported on the S Corp tax return for 2020 and is limited by 2020 W-2 income. SEP contributions made now could instead be applied to the 2021 year, but that would only make sense in very unusual situations.