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New Member
posted Mar 31, 2022 7:38:40 PM

LLC/Sole proprieter Convert to S Corp and SEP IRA's?

Hi, I Have my own business and I established a SEP IRA in 2020 when I was still a sole proprieter/LLC and made a contribution. I then applied to become an S-Corp, (still waiting to hear back from IRS) can I still use that same SEP Ira for my now S-Corp business?Business name is the same, etc. but I am now an employee of my Scorp and getting a W2 rather than 'self employed.'

 

And if I file an extension on my taxes till October do i have until Oct 2022 to make a 2021 contribution to the SEP?

 

Thanks!

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1 Replies
Level 15
Apr 1, 2022 5:15:11 AM

An employer can make the SEP contribution to any SEP-IRA owned by the employee, so the S corp can make its SEP contributions to the same SEP-IRA as you did as sole proprietor.

 

If the S corp uses a calendar tax year, the due date of a 2021 Form 1120-S was March 15, 2022 and it's now too late to request a filing extension.  If no request for a filing extension (Form 7004) was made by March 15, this S corp can't make a SEP contribution for 2021.  Filing Form 7004 by March 15 would have extended the filing deadline to September 15.