To calculate your maximum SEP IRA contribution allowed for a Schedule C business, multiply your net Schedule C income by 92.35%. Then multiply that result by 20% if your plan contribution rate is 25%.
If your plan contribution rate is something other than 25%, you will need to use the table in IRS Publication 560, page 23 to determine the percentage to use to calculate your maximum contribution (IRS Publication 560).
IRS Publication 560 also provides a worksheet that can be used to calculate your deduction.
Your SEP IRA contribution has no relation to your W-2 income. It is only based on your Schedule C net income.
The maximum allowed for 2019 is $56,000.
[edited 3/24/2020 | 9:16 am PST]
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
