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Sole Proprietor dies - can a SEP contribution be made?


Guest Bob K
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Guest Bob K

If a Sole Proproietor has a SEP plan established but dies before funding it for the current year, can a contribution be made by the estate?

My gut reaction is "no" but can't seem to find anything in writing to back up my position (checked the Answer Book, ERISA Outline Book and IRS Pub 560).

Would the same hold true for a sole proprietor who sponsors a profit sharing plan?

Thanks in advance

Bob

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:) Definately. The executor/rix can make the contribution on behalf of the sole-proprietorship. If there were employee's that participated the sole-proprietorship could make a contribution to employees, in which case an eligible owner with EI--although dead--would have to receive a SEP contribution, if any are made. The terms of a QP would determine whether it would have to allocate any contributions to the SE individual.
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