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Shelter Your Money – the SEP IRA Deadline

By Guest Author On July 26, 2011 Under Success Secrets

A Simplified Employee Pension plan,normally referred to as a SEP IRA, makes it feasible for the self-employed and small companies to provide for retirement benefits at a lower cost and with less reporting requirements than most other qualified retirement plans . The SEP IRA deadline for funding is the final tax-filing deadline, including extensions. So if you file for an extension, you normally have until October 15 to contribute to the account and still be in compliance with the SEP IRA deadline. If no extension is filed, thelast funding date is April 15 to contribute for the past year. A SEP plan is basically a group of individual retirement accounts maintained for employees. These plans offer an effective retirement plan for the workers, and also act as a legal and powerful tax shelter for the employer. Employees can fund their SEP with a pre-tax salary reduction, with the employer making the contributions on their behalf. The contribution allowed issignificantly larger than manykinds of IRAs, allowing qualified employees to contribute up to 25% of compensation, or $49,000 yearly. This makes the plan especiallyattractive to persons who might have gotten a late start getting ready and saving for retirement. The retirement benefits of a SEP areentirely vested as soon as they are contributed, making the account portable. Employees who might change employers can roll their SEP funds into another IRA or transfer them to a retirement account sponsored by their new employer.  The cost of setting up the SEP is economical, and the reporting requirements areeasy and simple, so SEP plans offer attractiveattributes for both employer and employee. To take complete advantage of the opportunities of the SEP, make sure to plan the flexible contribution schedule so you don’t miss the SEP IRA deadline. It’s a basic and smart way tostart accumulating retirement wealth.

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