Guest Andy Mayo Posted June 14, 2001 Posted June 14, 2001 I understand that EGTRA - Economic Growth and Tx Reconciliation Act of 2001 - amended Sec. 404(h), the deductibility limit for SEPs, but didn't amend Sec. 402(h), so the maximum contribution permitted is still 15%. In other words, a person could deduct up to 25% but can't make a contribution bigger than 15%. Can anyone confirm this?
davef Posted June 14, 2001 Posted June 14, 2001 It appears to be the case. Even though SEPs will be subject to the new 415© limits -- which will be the lesser of $40,000 or 100% of pay, and the deduction limit will be increased to 25% of pay, it doesn't look like IRC Sec. 402(h)(2) was changed. Perhaps this is something to be fixed under a Technical Corrections bill.
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