April fifteenth we know the deadline for filing personal tax returns but in tonight's tax tip financial advisor Eric Scott will explain how some self-employed people could save by filing for an extension you know this evening we're going to spend a few minutes on SEPs SDP or simplified employee pensions in the past we've talked about IRAs today we want to talk about SEPs and that's dealing with self-employed business owners small business people you know I'm asked the question quite often that is there an advantage of doing a set for self-employed or small business owners versus an IRA and there is everybody can contribute into an IRA but the problem is there's limits you know we talked to earlier in the show up to six thousand dollars based on your age but in a self-employed pension or an SCP you can contribute for last year up to about fifteen thousand five hundred dollars you know we're getting closer and closer to April fifteenth and what happens is we've got to contribute by that date for last year but a simplified employee pension or a SEP you actually can contribute all the way to October 15 we may not be able to put the full fifteen thousand five hundred or the amount we choose into the set program to maybe june or july so we go ahead and we can file an extension and in many cases we don't want to pay any more taxes so we make the payment in June July or August what about the small business owner does he have any employees can they contribute and you can design it so not only the employer or the self-employed person if they have other workers employees they can also contribute or it can be designed...
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5305a vs 5305 sep Form: What You Should Know
For more information, please refer to the IRS Publications and Technical Help webpage (PDF). Also see the Form 5305A-SEP (Rev. 9-2006) -- IRS In most cases, you can take the SEP deduction on most employees' Forms 1099, W-2s, 1099-B, 1099-A, or 1099-MISC as long as there are no other qualifying distributions, contributions, or payables that can be deferred. Your employee is considered a qualifying participant if the SEP deduction is made on his or her Form 1099 or 1099-B that shows such a SEP. You must deduct the SEP as taxable income from the employee's gross salary. Employee will usually need to furnish the SEP to the SEP administrator (usually by mail) and a copy to your payroll or withholding accountant. Employer has to keep the Form 5305A-SEP with the Form W-2 of each year's employee on file for each year of employment. 5305-SEP, Employee Pension—Individual Retirement Accounts; Simplified Employee Contribution Agreement; or SEP Employment and Federal Tax Questions Employment Taxes and Related Matters For more information, please refer to the U.S.
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