SEP
I have a client who turned 70.5 this year and is still working. She has a SEP. She Made a contribution in April 2014 for the 2013 tax year. My question is can she continue to make contributions to her SEP if she continues to work even though she has RMDs? Also, once a client reaches RMD age, can he still contribute to a traditional if he still has earned income? Thank you.
Permalink Submitted by Jose Morales on Wed, 2014-12-03 22:23
Yes, she can still make SEP contributions as long as she is otherwise eligible to make a SEP contribution even after reaching RMD age. She cannot make a regular Traditional contribution, as there is an age limit for eligibility. The Third section from the top of this page answers the question as well: http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-IRA-Contribution-Limits