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Topic: Anybody a CPA, accountant, IRS person? (Read 171 times) |
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Sandy_C
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Anybody a CPA, accountant, IRS person?
« on: Feb 11th, 2006, 4:23pm » |
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Tax question:
Hubby is self employed. I am a salaried employee, but also receive self-employment income. We both file Schedule C. We both also contribute to individual simple IRA retirement accounts every year on our regular 1040 joint return.. If we each open a SEP retirement account as self-employed individuals, can we contribute to both the SEP and our IRA's? You can contribute and deduct up to 25% of earned income to a SEP, and can contribute, (in our case because we're old folks) up to $4,000 each to our IRA accounts. Can we double up, so to speak, contribute to both?
Can't get my Turbo Tax to answer this one.
Thanks
Sandy
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_Lee_
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Re: Anybody a CPA, accountant, IRS person?
« Reply #1 on: Feb 11th, 2006, 6:04pm » |
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"Sandy Can we double up, so to speak, contribute to both? "
As long as the SEP is funded by a business, you can have a separate IRA, at least I did and never had a problem. When I left the co that set up the SEP I simply rolled it over to my personal IRA about 35,000.00. but still untaxed income. Got a business card?
Lee
PS: IRS.GOV
PS: all over agian SEP doesn't mean what it sounds like,
-SEP Simplified Employee Pension
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| « Last Edit: Feb 11th, 2006, 7:55pm by _Lee_ » |
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BarbaraD
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Re: Anybody a CPA, accountant, IRS person?
« Reply #2 on: Feb 11th, 2006, 9:33pm » |
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Yep you can set up a SEP along with the IRA. I'm doing it for a client now. He made WAY too much last year....Might as well pay yourself as the government.
But the catch with the SEP is - If you have employees, (and there are some conditions on this) you have to include them in the SEP. (they have to have worked continusously for two years to be included - do what you will with that one). So it does have drawbacks also.
I'd suggest you go see a broker who's up to date on these things before you do anything (don't know where you live, but I usually suggest Edward Jones - those guys are up to date on tax stuff). You have till April 15th to get this set up.
Good luck...
Hugs BD
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Sandy_C
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Re: Anybody a CPA, accountant, IRS person?
« Reply #3 on: Feb 13th, 2006, 9:31am » |
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Thanks for the info Lee and Barb. Going to look in to opening up SEP accounts.
Sandy
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