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SEP IRA (Simplified Employee Pension)

The SEP IRA is one of the simplest and most cost-effective retirement plans available to sole proprietors, self-employed individuals, and small business owners. The employer makes all contributions directly into a traditional IRA established for each eligible employee. Contributions are completely discretionary — you decide each year whether and how much to contribute, up to the annual limit.

Key features:

• No annual IRS filing requirements (unlike 401(k) plans)
• Contributions are tax-deductible for the business
• The same contribution percentage must apply to all eligible employees
• Employees are immediately 100% vested in all contributions
• Can be established as late as the tax-filing deadline (including extensions)

For sole proprietors and small businesses looking for the simplicity of a traditional IRA with significantly higher contribution limits, the SEP IRA is often an ideal starting point. Please contact us to discuss whether a SEP is right for your situation.

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