No. of Recommendations: 0
TOF, in an otherwise excellent explanation of how to derive a SEP-IRA contribution for the self-employed, said in part:

<<It works out to 13.04348 percent. You do it like this. Take all your deductions except for the SEP IRA to see what your AGI would be. Let's say it is $10,000 for round numbers. Now ask yourself the question, "What do I subtact from $10,000 so that what is subtacted is 15 percent of what's left over".>>

AGI has absolutely nothing to do with it. It's income from self-employment and only income from self-employment that counts. AGI may be composed of wages from another job in which one is the employee, interest, capital gains, and dividends as well as a whole host of other income items. Thus, think "self-employed income," and banish any mention of AGI from the discussion.

Print the post  


The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.