Investment and Finance
The most frequently asked tax questions related to Investment and Finance
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Answer Tax QuestionsSep and Simple IRAs
Asked Monday, November 14, 2011 by an anonymous user
Employers can contribute up to a quarter of the salaries that each employee earns (25%)up to an annual maximum limit. For 2017, that maximum will be $54,000, up $1,000 from its 2016 level. That's the first rise in the SEP IRA limit since 2015,
For self-employed. the 25% refers to the self-employed worker's "net earnings" from the business. The net result of the math is that the 25% limitation on "net earnings" works out to 20% of your adjusted profit after the self-employment tax adjustment
For self-employed. the 25% refers to the self-employed worker's "net earnings" from the business. The net result of the math is that the 25% limitation on "net earnings" works out to 20% of your adjusted profit after the self-employment tax adjustment
When must Form 5500 be filed by?
Asked Monday, November 14, 2011 by an anonymous user
The filing deadline for Form 5500 is the last day of the 7th month after the end of the plan year. An extension can be filed if needed.
Do I have to contribute every year to me SEP plan?
Asked Monday, November 14, 2011 by an anonymous user
NO. Contributions do not have to be made every year. Contributions must be made based on written allocation formulas and must not discriminate.
What tax form must be filed for a Keogh plan?
Asked Monday, November 14, 2011 by an anonymous user
Form 5500 or Form 5500-EZ is required to be filed.
Do employees have to be included in Keogh plans?
Asked Monday, November 14, 2011 by an anonymous user
Yes. All employees who have reached age 21 with at least 1 year of service. Generally, a employer does not have to cover seasonal or part-time employees who work less than 1,000 hours during a 12 month period.
When is the SEP filing deadline?
Asked Monday, November 14, 2011 by an anonymous user
Unlike a Keogh, which must be set up before the end of the taxable year in which the plan is to be effective, a employer may contribute to a SEP (Simplified Employee Pension IRA) set up by the filing deadline of Form 1040 (generally 4/15/XX) including extensions.
Can I contribute to a Keogh or SEP plan after age 70 1/2?
Asked Monday, November 14, 2011 by an anonymous user
Yes. You may continue to contribute to your Keogh or SEP plan if you have Self-employment income. You are required to receive a minimum distribution by April 1 of the following year in which you reach age 70 1/2 after ages 70 1/2 if you are more than a 5% owner.
Can I contribute to a Keogh or SEP plan after age 70 1/2?
Asked Monday, November 14, 2011 by an anonymous user
Yes. You may continue to contribute to your Keogh or SEP plan if you have Self-employment income. You are required to receive a minimum distribution by April 1 of the following year in which you reach age 70 1/2 after age 70 1/2 if you are more than a 5% owner.
IRA contribution - multiple businesses with profits and losses
Asked Monday, November 14, 2011 by an anonymous user
If you have multiple self-employment activities, you must aggregate profits and losses from all the activities to determine if you have "Net Income" on which the IRA contribution would be calculated upon. If the net result is negative, No contribution is allowed.
