SEP IRA Contribution

Today TaxMama hears from Nancy in New York who tell us. “I made a timely SEP-IRA contribution prior to the extension deadline. I forgot to file my tax return until October 17th. Is the SEP contribution still valid with late filing of the return?”

Dear Nancy,

It’s not clear what you mean by “prior to the extension deadline”?

If you’re saying the SEP contribution was made before April 15, 2008, it’s a valid contribution for 2007.

But if the contribution was made after April 15th, it would not be valid for 2007. Though it could be applied to 2008. Why? The extension is no longer valid if the tax return isn’t filed before it expires.

That means you’ll probably have to amend the 2007 tax return to remove the SEP contribution.

Now, if I am wrong about this, we’ll be hearing from the Pros. So keep an eye on the Comments to today’s TaxQuips.

And remember, you can find answers to all kinds of questions about retirement contributions and other tax issues, free. Where? Where else? At TaxMama.com

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