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Hello Fools.

I have been self employed for a couple of years, and this year I got my act together enough to start a SEP IRA account so I can squirrel some savings away. I have some pretty basic questions to make sure I don't mess up here.

I opened the account a couple of months back and have not made any contributions yet. I am under the impression that I can make the contribution as a lump sum. Is that correct? (I sure hope so)

Further, I am under the impression that I don't have to make that contribution by Dec 31st, but rather I can wait and see until tax time (April 15) how much my income was this year, and only then decide what 15% of that is, and hence determine my contribution. Am I right?

The contribution is based on the AGI (again, my impression - where the heck did I get these impressions anyway :-). And the AGI depends on my deductions, which the contribution is one. Isn't that a catch 22 situation? Do I just iteratively figure out a ballpark 15%?

Final question for bonus points: next year, I'd like to contribute as I go along, rather than in a lump sum. Under the assumption that it would be a Bad Thing if I over-contributed (how do you take money back out???), can I contribute conservatively as I go along, and then make a top-up payment to come up to the 15% at the end? I guess in general what I am asking is: do I only have the choice of contributing either regularly or in a lump sum, or can I contribute anything anytime so long as it adds up to the lesser of 15% or 30K?

Phew. That's a lot of questions. I am grateful for any answers.

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