jhunter[at]huntercomputerinc.com wrote:

- quote -

What that refers to are self-employed individuals
establishing the plan, i.e. proprietors or partners. It
does not extend to "self employed' subcontractors, e.g. your
"accounting person".

ChEAr$,
Harlan Lunsford, EA n LA

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

<jhunter[at]huntercomputerinc.com> wrote

- quote -

No. Subcontractors are not your employee.

- quote -

1. Eligible Employees
All eligible employees must be allowed to participate,
including part-time employees, seasonal employees and
employees who die or terminate employment during the year.
An eligible employee is an employee who:
.. Is at least 21 years of age.
.. Has performed service for you in at least 3 of the
immediately preceding 5 years.
The term "employee" includes a self-employed individual who
has earned income and a working business owner.

Certain leased employees must be treated as "employees."
---
That is not referring to any legitimate subcontractors, but
to your employees, and you - as a sole-proprietor (if that
is the case). And - that means that you can't be the only
"corporate" employee and lease the other workers to bypass
the law.

- quote -

She isn't your employee for SEP purposes.

--
Paul A. Thomas, CPA
Athens, Georgia
taxman at negia.net

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

jhunter[at]huntercomputerinc.com wrote:

- quote -

You seem to forget one important element/requirement of the
SEP plan for your company - she is NOT your employee! No
more than the plumber or electrician you hire to do work on
your house. Your only obligation to this person is to pay
her bill when the work is done.

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

=====
ISSUE
=====
If I establish a SEP for myself, do I really have to include
any SELF-EMPLOYED subcontractors, who I pay more than $450
per calendar year, in this plan?

================
WHERE I SAW THIS
================
http://www.irs.gov/pub/irs-tege/sep_checklist.pdf
Page 2 under Eligible Employees

==========
BACKGROUND
==========
I am a S-Corp
I am the only employee
I have a accounting person who comes in once per quarter to
file my quarterly taxes. She has done this every year for
more than 5 years. I pay her more than $450 per year. She is
self-employed.

=========
Thanks!!!
THE END
=========

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >