What is a SEP IRA? What is a SEP IRA?

What is a SEP IRA?

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Simplified Employee Pension IRA or a "SEP IRA" is a plan designed for those who are self-employed (i.e. 1099s) or business owners and carry with them the advantage of higher contribution limits. 

Additional Information about SEP IRAs: 

- Maximum contribution is $61k for 2022 ($58k for 2021) or roughly 25% of your business’s revenue (whichever is lesser) and is determined by a set formula, which should be discussed with a financial or tax professional

- Funded with pretax income

- Grows tax-deferred

- Taxed once you take distributions at an ordinary income level

- Cash contributions are tax-deductible


For more information, please visit the IRS website.


** Disclaimer - Please reach out to your tax advisor or CPA about your contribution limits and more importantly, your eligibility to contribute to a SEP IRA.