What are the advantages of a SEP?
For employers: • Tax benefits: employer contributions are tax-deductible business expenses. • Flexibility: employers can decide how much to contribute, up to the IRS-imposed limitations, or whether to contribute at all. • Ease: a retirement plan that’s easier to set up and more economical to administer than a 401(k) plan. For employees: • Tax benefits: contributions and earnings are tax-free until withdrawn. • Retirement plan: employees build retirement savings.
