-5-
Discussion
A Simplified Employee Pension (SEP) plan is described in
section 408(k).1 A SEP is a plan pursuant to which an employer
1 SEC. 408(k) states in pertinent part:
(k) Simplified Employee Pension Defined.--
(1) In general.--For purposes of this title,
the term “simplified employee pension” means
an individual retirement account or
individual retirement annuity--
(A) with respect to which the
requirements of paragraphs (2),
(3), (4), and (5) of this
subsection are met, and
(B) if such account or annuity is
part of a top-heavy plan, with
respect to which the requirements
of section 416(c)(2) are met.
(2) Participation requirements.--This
paragraph is satisfied with respect to a
simplified employee pension for a year only
if for such year the employer contributes to
the simplified employee pension of each
employee who--
(A) has attained age 21,
(B) has performed service for the
employer during at least 3 of the
immediately preceding 5 years, and
(C) received at least $300 in
compensation (within the meaning of
section 414(q)(7)) from the
employer for the year.
* * * * * * *
(3) Contributions may not discriminate in
(continued...)
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011