JohnH Posted September 12, 2007 Report Share Posted September 12, 2007 This always throws me. I've seen it discussed before (maybe on the old board), but can't find it now. When using a 3-year qualifying period for a SEP IRA contribution, does the year of the contribution count? For example, if the employee has earnings in 2006, can he be excluded if he had earnings in 2004 & 2005 but no earnings in 2001, 2002, & 2003? (This all assumes the employee was over the age limit and earnings exceeded the applicable amounts for all years in question) Quote Link to comment Share on other sites More sharing options...
JohnH Posted September 13, 2007 Author Report Share Posted September 13, 2007 Cancel the question. I found the answer. I'm putting up the link so I can find it here if (or when) I forget again. http://www.irs.gov/retirement/article/0,,id=111419,00.html#8 The year of the contribution does not count in the 5-year qualifying period. It's 3 out of the 5 PRECEDING years. In my example the employee is excluded unless the employer wants to shorten the qualifying period. Quote Link to comment Share on other sites More sharing options...
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