SEP Contribution Question
Hello,
I was wondering if I could get your feedback on the following scenario:
Q. Bob owned his own business with no employees. He had a SEP plan for his business. Before making his SEP contribution for 2020, he died.
A. Can the required SEP contribution be made to Bob’s account after he has passed away? Being that SEP contributions are employer contributions and Bob was eligible to receive one, I think the answer is YES.
Thank you.
Permalink Submitted by Alan - IRA critic on Tue, 2020-11-17 14:26
I agree, and this is where a SEP contribution differs from a personal TIRA or Roth IRA. That said, the executor will have to handle this and it could be very challenging finding a SEP custodian who will accept the contribution. Note that if an employee of a SEP owner passed, the business would clearly have to make the SEP contribution to deceased’s SEP IRA.