Simple/SEP
Dentist who is a client. Dentist owns a practice that is taxed as a partnership (not an S corporation). Owner will have a loss for the year. Owner does not pay himself a W2 wage.
Can owner contribute to a Simple?
If not, would it be possible to contribute to a SEP?
Permalink Submitted by William Tuttle on Tue, 2021-07-13 01:05
All employer retirement plans; defined benefit or defined contribution (SIMPLE IRA, SEP IRA or 401k) plans, require earned income in order to make employee and/or employer contributions. For self-employed individuals (such as partners), this requires net earnings from self-employment (earned income) = business profits – 1/2 SE tax. No profits, no contributions from any type of plan.