The calculation is done on the Keogh, SEP and SIMPLE Contribution Worksheet. Use the Maximize function for a SEP or Keogh Profit Sharing contribution to have TurboTax calculate the maximum employer contribution.
The maximum employer contribution is not 25% of your net profit from self-employment. The maximum employer contribution to a self-employed retirement plan is 20% of net earnings from self-employment. Net earnings from self-employment are net profit minus the deductible portion of self-employment taxes.
