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Investments > Financial Planning > Re: SEP plan fo...
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Re: SEP plan for side business?

by Rich Carreiro <rlc-news@[EMAIL PROTECTED] > Apr 23, 2008 at 12:07 PM

oprah.chopra@[EMAIL PROTECTED]
 writes:

> Is my yearly contribution limit still 25% of my business income ( i.e
> 10k , assuming 40k in side-business income )?

How is your business structured?  If it is a sole proprietor****p,
the limit is actually 20% of your net business income (net business
income is Sched C profit minus half the SE tax), not 25%.  (Well
technically it's 25%, but it's 25% of Sched C profit minus half the
SE tax minus the SEP contribution itself.  When you work out the
recursion,
it turns out to make the nominal 25% limit an actual 20% limit).

> Or is it lower since I max out my 401k?

Your 401(k) contributions as an employee have no effect
on SEP contributions.

--
Rich Carreiro                            rlc-news@[EMAIL PROTECTED]
 is a moderated newsgroup where Moderators
strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond.  For all of the other tips and suggestions, see "FROM
THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on
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 9 Posts in Topic:
SEP plan for side business?
oprah.chopra@[EMAIL PROTE  2008-04-19 13:40:31 
Re: SEP plan for side business?
Rich Carreiro <rlc-new  2008-04-20 12:29:26 
Re: SEP plan for side business?
oprah.chopra@[EMAIL PROTE  2008-04-23 10:49:06 
Re: SEP plan for side business?
Rich Carreiro <rlc-new  2008-04-23 12:07:37 
Re: SEP plan for side business?
Will Trice <wtrice@[EM  2008-04-23 19:26:08 
Re: SEP plan for side business?
Rich Carreiro <rlc-new  2008-04-23 22:05:38 
Re: SEP plan for side business?
Will Trice <wtrice@[EM  2008-05-08 19:24:34 
Re: SEP plan for side business?
Rich Carreiro <rlc-new  2008-05-08 20:00:43 
Re: SEP plan for side business?
Tad Borek <borekfm@[EM  2008-05-09 11:59:55 

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