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        New Message Board Archives >> 2006 General Board Posts >> Anybody a CPA, accountant, IRS person?
        
(Message started by: Sandy_C on Feb 11^th, 2006, 4:23pm)

Title: Anybody a CPA, accountant, IRS person?
Post by Sandy_C on Feb 11^th, 2006, 4:23pm

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

Title: Re: Anybody a CPA, accountant, IRS person?
Post by _Lee_ on Feb 11^th, 2006, 6:04pm

"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

Title: Re: Anybody a CPA, accountant, IRS person?
Post by BarbaraD on Feb 11^th, 2006, 9:33pm

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

Title: Re: Anybody a CPA, accountant, IRS person?
Post by Sandy_C on Feb 13^th, 2006, 9:31am

Thanks for the info Lee and Barb. Going to look in to opening up SEP accounts.

Sandy