IRA and SEP Contribution

Forum|Forum|4 years ago
February 21, 2022
2 replies
14 views

Though a SEP contribution and a traditional IRA contribution is permiitted for the same taxpayer, the program doesn't allow this. Anybody have any insight?

ProSeries Professional

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rbynaker

Level 13

A SEP is an employer plan so the deductibility of an IRA contribution would depend on the AGI. If it's not deductible the system should generate Form 8606-T or -S.

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ponstadAuthor

Level 2

Thanks for the response. It's a self-employed person with $25K of income. Wife had a W-2 of $4K with no retirement plan. They are both over 72, but that shouldn't matter. Shouldn't both the SEP and Traditional be allowable. If I put the SEP in, it disallows the Traditional. Doesn't seem right.

Just-Lisa-Now-

Intuit Community Champion

Scroll down the IRA contributions worksheet to see the calculation, maybe that will help it make sense?

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

B

barrysafeer

Level 4

I see the same issue for one of my clients. They should be allowed to contribute to both Traditional IRA and SEP IRA. But adding the SEP IRA makes the check box for "covered by a retirement plan" active.

Did you figure this out?

rbynaker

Level 13

@barrysafeer wrote:

I see the same issue for one of my clients. They should be allowed to contribute to both Traditional IRA and SEP IRA. But adding the SEP IRA makes the check box for "covered by a retirement plan" active.

Did you figure this out?

I think you're confusing "allowed to contribute" and "eligible for a tax deduction."

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barrysafeer

Level 4

Ahh. So you can always contribute to both but both aren't tax deductible. Got it. Thanks.

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