How much of the contribution made to employees SEP-IRAs may be deducted on the businesss tax return?
The most that may be deducted on the business’s tax return for contributions to its employees’ SEP-IRAs is the lesser of its contributions or 25% of compensation. (Compensation considered for each employee is limited to $230,000 in 2008, $245,000 for 2009 and subject to annual cost-of-living adjustments for later years.) If the employee is self-employed and contributes to his or her own SEP-IRA, a special computation to figure out the maximum deduction for these contributions must be made.
Related Questions
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- How much of the contribution made to employees SEP-IRAs may be deducted on the businesss tax return?
