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How to record SEP IRA in Quickbook

So i have a client who is LLC not SCorp he purchased SEP IRA. Where in the chart of accounts would that expense that is tax deductible for before it hits his 1040 Tax Return?

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  1. 74 Answers

    Hi if your client is an LLC and reports business income and expenses on the Schedule C of 1040, the SEP-IRA contributions should not be recorded on the profit and loss statement. If you would like to track these contributions you can set an up equity account on the balance sheet. I would title this account Owner – SEP-IRA Contribution so the amount can be tracked. The reason this should not be reported on the P&L is that the SEP-IRA account is a personal account, not a business account. Although your client will receive credit for this contribution on their tax return this is not specifically a business expense and should be reflected on the profit and loss statement. Hope this helps!

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