A SEP allows employers to establish SEP-IRAs
for all eligible employees, including owner employees. The employer
must contribute a uniform percent of pay for each employee - the
current maximum is 15% or $30,000, whichever is less. Contributions
are deductible to the employer.
Participants are always 100% vested in the
SEP-IRA account. The participant has complete investment control of
the SEP-IRA.
Because there are minimal requirements to
establish the SEP-IRA, and no reporting requirements, they are very
inexpensive plans to maintain.