I have a client who is a salaried W-2 employee not covered by an employer plan. Client also has an unrelated side business with Sch C income. Can he contribute to a SEP based on his Sch C income and make a deductible contribution to a traditional IRA based on his unrelated W-2 income? My software wants to know if he is "covered" by a retirement plan. Is he deemed to be covered by a retirement by virtue of the existence of his SEP which would place stricter contribution limits on his ability to contribute to the IRA? Sch C business has no employees, no common control issues.
