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2019 Excess SEP IRA contribution withdraw deadline

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Level 4

One client over contributed (before 7/15/2020) SEP IRA by $2k .

I thought the deadline to withdraw is 10/15/2020 the extension tax return due.But the request form to withdraw from the Investment Financial Institution was not clear, it only had two option of requesting before my tax filing date 4/15 and after.

 

Also I thought for SEP IRS does not request the financial institution keep track the year of SEP contribution ( but for Roth I know), so on the investment statement does not say which year ( actually I check the qtr statement, it only says Trade date Employer auto contribution, in this case the owner can keep track and indicate $2k is for 2020 contribution not 2019, so not need to go through the withdraw process.

 

Can anyone please help??

 

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3 Replies 3
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Level 15

Your reasoning on applying the extra 2K to 2020 is sound. Just be sure the client understands and also keeps it in mind for filing next year. Maybe they could even do it earlier to avoid the rush and confusion? (Wishful thinking!)

 


ex-AllStar
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Level 13

"so on the investment statement does not say which year"

Look at the 5498 when it is issued, and I would contact the financial institution directly to see if it is noted as Current Year or Prior Year.

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Level 4

thanks.

I confirmed that IRS does not require repor SEp contribution for which year.

On form 5498, it only state the contribution amount in the year.

So the owner's need to keep track their own contribution

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