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The employer side of the SE tax is tax deductible.

A self employed person can also set up a self employed 401K and be able to contribute more to their 401K than a SEP-IRA with an income of approx $100,000 a year. There is a little more paper work, but the tax advantage of being able to defer more money to your retirement plan makes it worth it.

Fidelity has some info on their web site comparing the two plans.

Overview Self Employed/Small Business Plans:
http://personal.fidelity.com/products/retirement/getstart/newacc/smallbizintro.shtml

Benefits of a Fidelity Self-Employed 401K:
http://personal.fidelity.com/products/retirement/getstart/newacc/keogh.shtml

Sue

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