screwed up my 2017 SEP contrabution

Submitted by Steve Rubenzer on Fri, 2018-04-27 17:45

I gave Fidelity the wrong account to draw funds from, so my order on April 15th didn’t go through. Is there any way I can still get my 2017 SEP contribution and resulting tax break? I read the prior post on IRA disaster, but found it hard to interpret. Simple and straightforward direction would be appreciated.



Submitted by Alan - IRA critic on Fri, 2018-04-27 17:57

You can still make the SEP contribution if you filed a timely extension, but not if you filed your 2017 return.

Submitted by Steve Rubenzer on Fri, 2018-04-27 18:17

Thanks Alan.  Unfortuantely, I filed my return on time.  No exception if I file a revised/corrected return? 

Submitted by Alan - IRA critic on Fri, 2018-04-27 18:38

Sorry, no.

Submitted by William Tuttle on Sat, 2018-04-28 00:07

FYI, it will not help you now. If you file an extension it extends your contribution due date even if you have or will file on time. I always suggest that if you have not made employer plan retirement contributions by 4/1, you should file an extension. Note: This does not work with IRAs. That contrbution deadline is without regard to any extensions.

Submitted by Alan - IRA critic on Sat, 2018-04-28 03:21

spiritrider – do you know of any official guidance for this situation – you file your return in March, then realize you could have made a SEP contribution but will not have the money until August. So even though you filed, you file an extension for the sole purpose of extending the deadline for making the SEP contribution. Is an extension valid in this situation?  That would fall under your “have filed” statement in your past post. I could not find anything about this in the IRS Regs or 4868 Inst.

Submitted by William Tuttle on Sat, 2018-04-28 05:39

  • I have seen it. Now I just have to find it. I really should find a way of catologing these individual snippets. I tend to find them when a I am looking for something else.
  • The IRS website does not constitute “substantial authority”, but at https://www.irs.gov/retirement-plans/retirement-plans-faqs-regarding-seps-contributions, under When must I deposit the contributions into the SEP-IRAs? The following paragraph is presented:
  • “You must deposit contributions for a year by the due date (including extensions) for filing your federal income tax return for the year. If you obtain an extension for filing your tax return, you have until the end of that extension period to deposit the contribution, regardless of when you actually file the return.”
  • It may be as simple as the plain language interprptation of 404(h)(1)(B). The due date for the filing of the return is extended by law and therefore the contribution deadline is also extended. There is no specific condition on actually filing the return, therefore it is irrelevant:
  • “Contributions shall be treated for purposes of this subsection as if they were made for a taxable year if such contributions are made on account of such taxable year and are made not later than the time prescribed by law for filing the return for such taxable year (including extensions thereof).”
  • I’ll look for more specific sustantial authority.

Submitted by Alan - IRA critic on Sat, 2018-04-28 15:25

I was thinking more along the lines that if the return was already filed by the due date, the extension might be considered invalid since it is immaterial in the usual sense, but of course not immaterial with respect to making the SEP contribution. 

Submitted by David Mertz on Sat, 2018-04-28 16:20

CCA 200645019 provides some useful information.  A tax return filed by the regular due date is deemed to be filed on the regular due date, so it seems that an extension requested by the regular due date would be valid even if an original tax return had already been filed prior to requesting the extension.

Submitted by Alan - IRA critic on Sat, 2018-04-28 17:25

Great, thanks.

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