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Clarification/Confirmation please:

I see regularly on these discussions of the SEP IRA this 13.04348 - and I just want to run this by you guys:

This is true for those who are truely Self-Employed - those with sole proprietorships. As for the math in the previous post - I thought the 13.04348 was due to Self-Employment Tax and that you could only count 1/2 of that tax as income for the purpose of the 15% calculation because the other 1/2 is normally paid by an employer and not counted as salary for the calculation of 401k contributions etc...

I consider myself 'Self Employed' but I'm really an employee of a corporation wholly owned by me(an S Corp). In my case - I pay myself a salary of 150,000 - this costs my corp more than 150,000 - because of the company 1/2 of Social Security and Medicare - but that's moot - the 15% rule for me applies to the salary of 150,000. So my corp is contributing 22,500 to my SEP for me. I ran this by my accountant and he agreed - the 13.04348 does not apply to me because I'm not truely SELF-EMPLOYED.

How wrong am I?

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