SEP IRAs — The easy-to-do retirement benefit just for small businesses

SEP IRAs — The easy-to-do retirement benefit just for small businesses

If you’re a small business owner looking to give your employees a simple but valuable benefit, the SEP IRA is relatively easy to set up and administer.

The Simplified Employee Pension (SEP) is a retirement plan that lets self-employed and small business owners make a tax-deferred retirement contribution to the plan on behalf of each employee.

Voya can help you set up a SEP plan for your small business, and serve as the IRA custodian holding assets for each employee.

Key Features

  • Do it for yourself. You can set up a SEP plan for yourself if you’re self-employed (sole proprietor or as a partner), with or without employees.
  • Do it for your employees. If you run a business and have employees, a SEP plan covers everyone.
  • Excluded from income. Contributions are not included as part of the employee’s income.
  • Bigger contributions allowed. Contribution limits are higher than with Traditional or Roth IRAs – up to 25% of each employee’s pay with a maximum annual limit of $58,000 in tax year 2021.
  • Contributions can vary. To adjust for cash flow fluctuations, employers can decide on how much to contribute each year or can opt out for a year.
  • Contributions could reduce your tax liability. Contributions are deducted from the employer’s income which may reduce current federal income taxes.
  • No employee contributions. Only the employer can make contributions.
  • Keep on contributing. An employee can continue to contribute to their own Traditional or Roth IRA (subject to IRS income eligibility guidelines).


You can read more about SEP IRAs on the IRS website, or contact a Voya financial professional.

This material is provided for general and educational purposes only; it is not intended to provide legal, tax or investment advice. All investments are subject to risk. We recommend that you consult an independent legal or financial professional for specific advice about your individual situation. 

Securities offered through Voya Financial Advisors, Inc. member SIPC.