I am a small business LLC with only one person working myself, and I am over 60years old.
Good morning Tax Community
If I make a contribution to a SEP IRA and later withdraw the funds do I ever pay the 15.3% social security taxes on the contribution or the withdrawal?
Examples: I contribute $10,000 of business income that would would normally get reported on schedule C as income which I would be charged the 15.3% social security tax in addition to Federal & State taxes. But since I contribute it to a SEP IRA I avoid all three for these (15.3% social security, Federal, & State taxes). Correct ?
And once I withdraw these funds I only pay Federal, & State taxes?
So I have avoided the 15.3% social tax completely. Is there any time limit the money has to be held in the SEP IRA account before I can withdraw it, since I am already over 60?
Thanks
