Guest TracyAndrews Posted March 23, 2001 Posted March 23, 2001 Can an LLC have both a SEP and a regular 401(k) plan peacefully coexist? There is only the owner eligible for the SEP contribution (relatively new company), and the 401(k) has lots of participants. He was only able to defer about 3000 in 2000 due to ADP restrictions. He would like to make up the balance in the SEP. Is this ok? He wants to kill the SEP plan next year before any participants become too close to becoming eligible for a contribution. Something sounds fishy but I'm not sure what.
Appleby Posted April 5, 2001 Posted April 5, 2001 Yes- The SEP must be a prototype SEP- not a Form 5305 SEP Life and Death Planning for Retirement Benefits by Natalie B. Choatehttps://www.ataxplan.com/life-and-death-planning-for-retirement-benefits/ www.DeniseAppleby.com
Guest Philip Simpkins Posted December 5, 2001 Posted December 5, 2001 Does anyone know the site that allows for this? Thanks!
R. Butler Posted December 5, 2001 Posted December 5, 2001 IRC 404(h)(2) contemplates an employer having both a SEP and a qualified plan. Publication 560 instructs employers when Form 5305 can be used. Appleby is correct that form 5305 can't be used if employer maintains a qualified plan.
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