have sep ira, am only employee
You'll need to sign in or create an account to connect with an expert.
TurboTax does the correct calculation. Since a SEP contribution is an employer contribution, a SEP contribution effectively reduces your compensation on which the maximum contribution is calculated, so a special calculation must be done. A 25% base rate results in a maximum SEP contribution of 20% of net earnings from self-employment being the maximum contribution by a self-employed individual.
See IRS Pub 560, Chapter 5: https://www.irs.gov/pub/irs-pdf/p560.pdf
TurboTax does the correct calculation. Since a SEP contribution is an employer contribution, a SEP contribution effectively reduces your compensation on which the maximum contribution is calculated, so a special calculation must be done. A 25% base rate results in a maximum SEP contribution of 20% of net earnings from self-employment being the maximum contribution by a self-employed individual.
See IRS Pub 560, Chapter 5: https://www.irs.gov/pub/irs-pdf/p560.pdf
The maximum SEP IRA contribution is the smaller of $55,000 or 25% of the participants compensation. Is it perhaps take the smaller amount?
Still have questions?
Make a postAsk questions and learn more about your taxes and finances.
stephenrkg
Level 2
JohnASmith
Level 3
Magnfdplaid878
Level 1
a8891
Returning Member
HL14
New Member
Did the information on this page answer your question?
You have clicked a link to a site outside of the TurboTax Community. By clicking "Continue", you will leave the Community and be taken to that site instead.