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Posted by pete on January 18, 2007, 3:22 am
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Hi i'm self employeed and paid myself a $24000 salary under
a s-corp entity. after business expenses i then pay myself
the rest of profit as distribution, which is around $25000.
i contribute 25% of my earned income( 6k) to my sep ira
account. i was wondering if i can also make roth ira
contribution afterward or is there no double dipping? TIA
pete
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Posted by Phil Marti on January 19, 2007, 12:42 am
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> Hi i'm self employeed and paid myself a $24000 salary under
> a s-corp entity. after business expenses i then pay myself
> the rest of profit as distribution, which is around $25000.
> i contribute 25% of my earned income( 6k) to my sep ira
> account. i was wondering if i can also make roth ira
> contribution afterward or is there no double dipping?
SEPs have no effect on your ability to make regular IRA
contributions, Roth or traditional. See IRS Publication
590.
--
Phil Marti
Clarksburg, MD
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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Posted by cpabakem01 on January 19, 2007, 12:42 am
Please log in for more thread options pete wrote:
> Hi i'm self employeed and paid myself a $24000 salary under
> a s-corp entity. after business expenses i then pay myself
> the rest of profit as distribution, which is around $25000.
> i contribute 25% of my earned income( 6k) to my sep ira
> account. i was wondering if i can also make roth ira
> contribution afterward or is there no double dipping? TIA
>
> pete
Per IRS Q & A
Can a person make a contribution to a SEP-IRA and a Roth
IRA, too?
Yes, you can make a contribution to a SEP-IRA and a Roth
IRA. See Chapter 2 of Publication 590, Individual Retirement
Arrangements (IRAs), for the requirements to contribute to a
SEP and a Roth IRA. However, your SEP IRA contribution and
Roth IRA contribution can not be made to the same I
http://www.irs.gov/pub/irs-pdf/p590.pdf
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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Posted by Harlan Lunsford on January 19, 2007, 12:42 am
Please log in for more thread options pete wrote:
> Hi i'm self employeed and paid myself a $24000 salary under
> a s-corp entity. after business expenses i then pay myself
> the rest of profit as distribution, which is around $25000.
> i contribute 25% of my earned income( 6k) to my sep ira
> account. i was wondering if i can also make roth ira
> contribution afterward or is there no double dipping? TIA
Getting back to basics for a moment. You say "you"
contributed 25% to the plan. I hope you mean that the SEP
IRA is established BY THE corporation and that the
corporation contributed to it. The corporation then takes
the deduction on page one of 1120S.
Second part; then yes, you may also contribute to a ROTH
IRA, assuming you meet all other requirements.
All these things I, and my S corp, do.
ChEAr$,
Harlan Lunsford, EA n LA
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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