Chapter 4
Simplified Employee Pension (SEP)
Self-employed individuals, as well as other employers, can set up
simplified employee pension (SEP) plans. A SEP plan allows an employer
to make contributions toward employees' retirement, and, if
self-employed, his or her own retirement, without becoming involved in
more complex retirement plans.
A self-employed individual is an employee for SEP purposes. He or
she is also the employer. Even if the self-employed individual is the
only qualifying employee, he or she can have an IRA under a SEP plan
(SEP-IRA).
This chapter focuses on the rules affecting employees. For
information on the rules affecting employers, see Publication 560.
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