FTR TAX TIP OF THE MONTH
USE A SEP IRA TO MAXIMIZE YOUR RETIREMENT SAVINGS
RHUBARB OAT BARS
Are you a business owner? If so, the extension of the tax filing deadline to May 17 is good news for you. It means you have extra time to figure out how much and when you want to contribute to a Simplified Employee Pension (SEP) IRA for yourself and your eligible employees. The SEP IRA was designed for self-employed individuals and owners of corporations and partnerships. It gives you flexibility and the ability to maximize your retirement contributions. For example, the maximum SEP IRA contribution limit for 2020 is $57,000 per qualified individual! That’s much more than is allowed by traditional 401(k) or 403(b) retirement plans. The real beauty of an SEP IRA is that you have until the due date of your tax return to contribute for the previous year. Anyone can make an SEP IRA, traditional IRA, or Roth IRA contribution through May 17 and deduct eligible contributions on their 2020 tax return. But the SEP IRA is special because if you need more time to make a retirement contribution, it will still work for you. With an SEP IRA, self-employed people can file for an extension that pushes their deadline to Oct. 15, then wait until that date to contribute to their SEP IRA for 2020. I have seasonal business clients whose income is limited or non-existent during our Wisconsin winters, and this extra time allows them to generate revenue to fund the SEP IRA. S and C corporations and partnerships can also implement an SEP IRA and enjoy those benefits, with some advanced planning. If you filed or will file a timely extension (by March 15 for S corporations and partnerships, or April 15 for C corporations), then you have until Sept. 15 (for S corporations and partnerships) or Oct. 15 (for C corporations) to fund your SEP IRA. The SEP IRA contribution is calculated differently for self-employed people (Schedule C filers) than for employees. For employees, the calculation is simple: It’s any percentage of their gross wages or salary, up to a maximum of 25%, and capped at $57,000. The self-employed contribution is more complex. I won’t confuse you trying to explain it here, but please reach out to me to learn more or if you have any questions about SEP IRAs. I’m ready to help!
Inspired by TasteOfHome.com
1 1/2 cups fresh rhubarb, chopped 1 cup packed brown sugar, divided 1 tsp fresh lemon juice 4 tbsp water, divided
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1 cup old-fashioned oats 3/4 cup all-purpose flour 1/2 cup sweetened shredded coconut
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1/2 tsp salt
1/3 cup butter, melted
4 tsp cornstarch
1. Preheat oven to 350 F and grease an 8-inch square baking dish. 2. In a medium saucepan, bring rhubarb, 1/2 cup brown sugar, lemon juice, and 3 tbsp water to a boil. 3. Reduce heat to medium and cook until rhubarb is tender (about 5 minutes). 4. In a small bowl, combine cornstarch and remaining water, stirring until smooth. 5. Gradually add to the rhubarb mixture, return to a boil, and cook until thickened. Remove from heat and set aside. 6. In a large bowl, combine oats, flour, coconut, salt, and remaining brown sugar. Stir in butter until mixture is crumbly. 7. Press half of the oat mixture into the prepared baking dish, spread rhubarb mixture on top, then sprinkle with remaining oat mixture. 8. Bake 25–30 minutes until golden brown. Cool completely before enjoying!
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