SEP & Qualified Plan Contribution

[dmb]

If an employee terminates from an employer with a 401k Profit Sharing plan and the employee has deferred and receives a PS allocation for 2002, can that employee start their own business and contribute full contr to a SEP for 2002??

[mbozek]

As long as the employee does not own more than 50% of the stock or interest in the employer maintaining the PS plan, the employee can contribute to a sep plan for a separate business.