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Client wants to make a catch-up contribution to his SEP


Guest jc1457
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Guest jc1457

Hi,

We have a client who believes he can make a catch-up contribution to his traditional SEP (client does not have a SARSEP). We have shown him some research (IRS PUB 560 & CCH explanation) to help convince him that catch-ups are not permitted in traditional SEPs. IS there anything else I can show him. He is not convinced by what we have provided so far.

Thanks for your help.

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This is from the IRS site:

Can catch-up contributions be made to a SEP?

No. SEPs are funded by employer contributions only. However, catch-up contributions can be made to the IRAs that hold the SEP contributions if the SEP-IRA documents allow. The catch-up IRA contribution amount (for employees age 50 and older) is $1,000 for 2006 and later years.

Here's the link:

http://www.irs.gov/retirement/article/0,,id=111419,00.html

William C. Presson, ERPA, QPA, QKA
bill.presson@gmail.com
C 205.994.4070
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Guest jc1457
This is from the IRS site:

Can catch-up contributions be made to a SEP?

No. SEPs are funded by employer contributions only. However, catch-up contributions can be made to the IRAs that hold the SEP contributions if the SEP-IRA documents allow. The catch-up IRA contribution amount (for employees age 50 and older) is $1,000 for 2006 and later years.

Here's the link:

http://www.irs.gov/retirement/article/0,,id=111419,00.html

Thank you so much, I truely appreciate this.

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