If you are self-employed or own a small business, you may wish to consider a Simplified Employee Pension Plan. A SEP is a written plan that allows you to make contributions toward your own retirement and your employees’ retirement without getting involved in a more complex qualified plan.
Under a SEP, you make contributions to a Traditional IRA set up by or for each eligible employee. This SEP-IRA is owned and controlled by the employee, and you make contributions to the financial institution where the SEP-IRA is maintained.
If you are considering opening a SEP, you should first consult a qualified tax professional for information about eligibility requirements, restrictions, and benefits of this pension plan.
IRS Publication 560 has information about SEPs. It can be obtained on the IRS website by clicking here.
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