Choosing a SEP-IRA Plan

April 1, 2021

Are you a small business or sole proprietor looking for a retirement plan for you and your employees? Why not consider adopting a Simplified Employee Pension (SEP) IRA plan? In a SEP-IRA plan, you can make employer contributions of up to 25% of each employee's pay directly to an IRA set up for each eligible employee, including yourself.

It's easy to get started with a SEP-IRA. Just complete and sign the one-page IRS Form 5305-SEPPDF or a pre-approved SEP agreement with a financial institution and share it with your employees. You must include any employee in the plan who: has reached age 21, has worked for you in 3 of the last 5 years, and received at least $650 in compensation for 2021.