Business Account
SEP IRA for business owners
Higher contribution limits. Lower setup costs. Built for business owners and the self-employed.
A retirement plan built for business owners
Bigger contribution room, almost no admin.
A SEP IRA is a good fit for self-employed workers and business owners who want to save far more than the $7,500 a personal Traditional IRA allows in 2026. Setup is one plan document with no annual IRS filing and no compliance testing. Contributions are deductible to the business and 100% vested from day one. Workers can keep getting SEP contributions at any age as long as they have earned income.
2026 at a glance
The numbers you'll come back to.
$72,000
Maximum contribution
25%
Of compensation, max
$360,000
Pay cap on 25% math
Roth
Permitted under SECURE 2.0
Employer
Funded by the business only
100%
Vested, day one
Limits
SEP IRA Contributions (2026).
Here is what a business and an owner can put in, in plain language. Numbers update each year. SEP is funded by the business, not by employee paycheck deferrals.
A few terms we'll use
- Compensation
- Pay used to figure out how much can go in the account. For self-employed workers, this is net earnings after the self-employment tax adjustment and the contribution itself.
- Pay cap
- The IRS limits how much pay counts in the 25% calculation. For 2026 the cap is $360,000 (IRC §401(a)(17)).
- Pre-tax
- Money put in before income tax. The worker owes the tax later, when withdrawals come out in retirement.
- Roth
- Money put in after income tax. Qualified withdrawals in retirement come out tax-free.
- Vesting
- When the money in an account is fully the worker's. SEP IRAs are 100% vested the moment money goes in.
- RMD
- Required minimum distribution. Once the account holder turns 73, the IRS requires them to withdraw a set amount each year.
How much can go in
The headline numbers for the 2026 tax year, set by IRS Notice 2025-67.
$72,000
Hard cap
The §415(c)(1)(A) limit for 2026. The most that can go into one person's SEP IRA in a year.
25%
Of compensation
For W-2 employees, 25% of gross pay. For self-employed workers, 25% of net earnings after the SE-tax adjustment.
$360,000
Pay cap
The §401(a)(17) cap. Only the first $360,000 of compensation counts in the 25% math.
The 25% rule and the $72,000 dollar limit both apply. Whichever is smaller is the cap. For an employee earning $200,000, that is $50,000. For an owner taking $400,000 of W-2 pay, the pay cap of $360,000 holds the math to $72,000.
Pay tax now or later
SECURE 2.0 §601 (effective 2023) added a Roth option for SEP IRAs alongside the long-standing pre-tax version. Accuplan offers both.
Pre-tax (traditional)
Contributions go in before tax for the employee. Money grows untaxed. Withdrawals in retirement are taxed like regular income. Set up through IRS Form 5305-SEP.
Roth (post-tax)
Contributions are taxable wages to the employee the year they go in. Money grows tax-free, and qualified retirement withdrawals come out tax-free. Set up through a prototype plan document.
Roth SEP contributions are still deductible to the business as compensation, but they show up as taxable wages to the employee in the year contributed. Pre-tax contributions are deductible to the business and not taxed to the employee until withdrawal.
Self-employed math
If you are a sole proprietor, partner, or LLC member taxed as either, the 25% rule applies to net earnings, not gross revenue.
Start with net earnings
Net self-employment earnings for the year, what is left after business expenses on Schedule C or K-1 income.
Subtract two things
Take off the deductible half of your self-employment tax and the SEP contribution itself. The 25% applies to what is left.
Because of the self-employment tax adjustment and the rule that the contribution itself reduces the base it is calculated on, the effective rate for sole proprietors works out to roughly 20% of net earnings, not 25%. IRS Publication 560 has a worksheet.
Who can use it and how it runs
The basic rules for the business and its workers.
Any size business
Sole proprietors, partnerships, LLCs, S corps, and C corps can all open a SEP. There is no employee-count cap.
Which employees qualify
Workers who are at least 21, worked for the business in 3 of the last 5 years, and earned at least $800 in 2026. Employers can choose to be more generous.
Equal percentage rule
In any year the business contributes, every eligible employee gets the same percentage of pay the owner does.
All in, or none
In a year the business contributes, it has to cover every eligible employee. You cannot pick and choose.
Best for small teams
Because of the equal-percentage rule, the cost of a SEP scales with headcount. Most owners use a SEP when it is just them, or a few people.
Employer-only funding
No paycheck deferrals from employees. The business decides each year whether to contribute and how much.
100% vested, day one
Everything in the account belongs to the worker right away. Nothing to forfeit if they leave.
No catch-up
SEP IRAs do not have catch-up contributions for workers 50+, since employees do not defer their own pay.
No age limit on contributions
A worker with earned income can keep getting SEP contributions at any age. RMDs still start at 73 (75 starting in 2033) per SECURE 2.0.
Flexible year-to-year
The business is not locked in. You can skip a year, change the percentage, or close the plan without IRS penalty.
If a SEP does not fit your team, ask us about a SIMPLE IRA or Solo 401(k) instead.
The Accuplan difference
A SEP IRA you can self-direct.
A SEP IRA follows the same rules as a Traditional IRA for tax treatment, rollovers, and the kinds of assets it can hold. Most retirement accounts stick to stocks and bonds. The IRS allows a much wider list. With Accuplan, you can self-direct a SEP IRA into real estate, gold and other metals, private equity, or private loans. You get the higher SEP contribution limits and a wider menu of where the money goes.
How to start
Setting up your SEP IRA.
Four steps from sign-up to your first contribution. Most of the work is one IRS form you keep on file.
Open your account
Fill out a short online form with your business info. We verify your identity and your account is ready.
Sign the plan document
For pre-tax-only plans, the IRS provides a one-page form (Form 5305-SEP) you keep on file. For plans that include Roth, we provide a prototype document. Either way, nothing gets filed with the IRS.
Tell your team
Share the plan with eligible employees so they know what is coming.
Open an IRA for each eligible employee
Every eligible employee gets their own SEP IRA. Accuplan handles the paperwork.
Frequently asked
SEP IRA FAQs.
Who can open a SEP IRA?
Self-employed workers and businesses of any size, structured as sole proprietorships, partnerships, LLCs, C corporations, or S corporations, can open a SEP IRA. There is no employee-count limit.
Which employees does the business have to cover?
An employee qualifies if they are at least 21, have worked for the business in 3 of the last 5 years, and earned at least $800 from the business in 2026 (the §408(k)(2)(C) threshold, indexed each year). Employers can choose to be more generous than that.
Excludable employees are those covered under a collective bargaining agreement and non-resident aliens with no U.S. sourced income.
The owner counts as an employee for these rules. Once a year is set, every eligible employee gets the same percentage of pay the owner gets, and the business has to cover all of them. You cannot fund the owner and skip the staff.
Can I contribute to a SEP IRA and a personal IRA in the same year?
Yes. You can contribute to a SEP IRA and a Traditional or Roth IRA in the same year, up to the personal IRA limit of $7,500 for 2026 ($8,600 with catch-up if you are 50+). A SEP contribution can affect how much of your Traditional IRA contribution is tax-deductible because the SEP makes you an active participant in an employer plan.
Are SEP contributions Roth or pre-tax?
Both options exist with Accuplan. Pre-tax has been the long-standing default and is set up through IRS Form 5305-SEP. SECURE 2.0 §601 (effective 2023) added a Roth option, which requires a different plan document. Accuplan offers both.
Pre-tax contributions are deductible to the business and untaxed for the employee until withdrawal. Roth SEP contributions are still deductible to the business as compensation, but they show up as taxable wages to the employee in the year the contribution is made. Qualified withdrawals later come out tax-free.
Are there catch-up contributions for workers age 50+?
No. SEP IRAs are funded by the employer only, with no employee paycheck deferrals, so there is no catch-up provision. If you want catch-up room, look at a SIMPLE IRA or Solo 401(k).
When is the contribution deadline?
SEP contributions for a tax year can be made up until the business federal tax filing deadline, including extensions. For most calendar-year businesses that means as late as October the following year if you file an extension.
When do RMDs start for a SEP IRA?
SEP IRAs follow the same required-minimum-distribution rules as a Traditional IRA. RMDs start at age 73 for anyone who reached age 72 in 2023 or later, and shift to age 75 starting in 2033 (SECURE 2.0 §107). The first RMD is due by April 1 of the year after you turn 73.
Keep reading
More on SEP IRAs and business retirement plans.
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What Happens to Your 401(k) After Quitting?
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Employee Stock Ownership Plan Pros and Cons
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Borrowing and Lending from a Self-Directed IRA
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Using Your 401(k) to Buy Real Estate
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