What is a SEP IRA?

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What is an IRA?

What are Individual Retirement Accounts?

What is the difference between IRA's & 401(k)'s?

How many IRA's can you have?

What is a Qualified IRA?

What is a ROTH IRA?

What is a Non-Qualified IRA?

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How do I rollover my 401(k)?

How do I rollover my IRA?

Can I rollover my IRA?

Can I rollover my IRA?

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ROTH Annuity

IRA Annuity

SEP Annuity

MYGA Annuity

Baby Annuity

What is a ROTH IRA Annuity?

What is an IRA Annuity?

What is a SEP IRA Annuity?

What is a MYGA Annuity?

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How can I retire with Tax Free Income?

How do I create a Retirement Income Stream?

Will my Retirement account money last?

How long will I stay alive?

When do I draw Social Security?

How much do I need to Retire?

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What is a ROTH IRA?

Can I have a Tax Free Retirement?

Do I qualify for a ROTH IRA?

How much can I contribute to a ROTH IRA?

What is a SEP IRA? Is a SEP IRA right for me?

For more  information about SEP IRA’s, click here.

Maryland Annuity Resource offers SEP IRA services in Maryland, Washington D.C., and Virginia. We believe that any plan but especially a SEP IRA is the foundation to any investment portfolio. There are many differences amongst all of the Individual Retirement Accounts but we wanted to show you about SEP IRA’s in this section. This form of SEP IRA would be a SEP IRA Annuity as the underlying investment.

Simplified Employee Pension (SEP) plans can provide a significant source of income at retirement by allowing employers to set aside money in retirement accounts for themselves and their employees. A SEP does not have the start-up and operating costs of a conventional retirement plan and allows for a contribution of up to 25 percent of each employee’s pay.

  • Available to any size business
  • Easily established by adopting Form 5305-SEP, a SEP prototype or an individually designed plan document
    • If Form 5305-SEP is used, cannot have any other retirement plan (except another SEP)
  • No filing requirement for the employer
  • Only the employer contributes
    • To traditional IRAs (SEP-IRAs) set up for each eligible employee
    • Employee is always 100% vested in (or, has ownership of) all SEP-IRA money

How does a SEP work?

Jed works for the Rambling RV Company. Rambling RV decides to establish a SEP for its employees. Rambling RV has chosen a SEP because the RV industry is cyclical in nature, with good times and down times. In good years, Rambling RV can make larger contributions for its employees and in down times it can reduce the amount. Rambling RV’s contribution rate (whether large or small) must be uniform for all employees. The financial institution that Rambling RV has chosen for its SEP has several investment funds from which to choose. Jed decides to divide the contribution to his SEP-IRA among three of the available funds. Jed, an employee, cannot contribute because SEPs only permit employer contributions.

Pros and Cons:

  • Easy to set up and operate
  • Low administrative costs
  • Flexible annual contributions – good plan if cash flow is an issue
  • Employer must contribute equally for all eligible employees

Who Contributes: Employer contributions only

Contribution Limits: Total contributions to each employee’s SEP-IRA are limited.

Filing Requirements: An employer generally has no filing requirements.

Participant Loans: Not permitted. The assets may not be used as collateral.

In-Service Withdrawals: Yes, but includible in income and subject to a 10% additional tax if under age 59 1/2.

Additional Resources  Source IRS

Contributions an employer can make to an employee’s SEP-IRA cannot exceed the lesser of:

    1. 25% of the employee’s compensation, or
    2. $51,000 (for 2013, $52,000 for 2014).

Note: Elective deferrals and catch-up contributions are not permitted in SEP plans.

Participants in Salary Reduction Simplified Employee Pension (SARSEP) plans established before 1997 were entitled to elective deferral contributions. For these plans, a participant’s elective deferral contributions are further limited to $17,500 (in 2013 and 2014) or 100% of their compensation, whichever is less. Catch-up contributions are not subject to this limit.

Your SEP IRA would be in an Annuity form, we do not offer stocks, bonds, or mutual funds as underlying investments because they have the potential for losses that cannot be regained. If you are looking for a SEP IRA that has mutual funds as the main investment, please seek those elsewhere.

For more  information about SEP IRA’s, click here.

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