Husband Wife LLC and SEP Contributions
I have a new client that was advised by their tax advisor to set-up an LLC for her consulting business. It is a partnership (not S-corp) where she is 51% owner and he is 49% owner.
The tax advisor completed the 2016 return showing a SEP contribution for the wife only. Does the husband also need to have a SEP contribution made as well? Any clarification would be greatly appreciated. Thanks!!
Permalink Submitted by David Mertz on Thu, 2017-07-27 23:53
The above assumes that the husband is not a limited partner who performs no services for the LLC. If the husband is indeed a limited partner who performs no services for the LLC and receives no guaranteed payments, the husband’s income from the LLC is not self-employment income and no SEP contribution would be made for the husband.