2020 IRA Contributions & Deductions Infographic
Infographic summarizing IRS contribution limits and catch up provisions for retirement accountsLEARN MORE
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Designed for self-employed individuals and small business owners (typically with up to 25 employees), the SEP IRA allows an annual contribution of up to $56,000 in 2019 and $57,000 in 2020. Contributions to a SEP are tax-deductible, and earnings within the account are tax-free until withdrawn.
An employer may contribute up to 25% of each employee’s annual compensation (the maximum considered compensation is $280,000 for 2019 and $285,000 for 2020).
Any employer—whether a corporation, partnership, or self-employed individual—may establish the plan, even if there is only one employee.
Employees must meet ALL of the following requirements:
Spouses and children may also participate in the plan and open their own SEP IRAs—as long as they are employees of the company and meet the income requirements.
IRA Contribution Limits, Catch Up Provisions and Contribution Deadlines