IRA and SEP-IRA's

[oceanlovin'ea]

Scenario:

S corporation with 2 officers - husband and wife. Husband draws salary and wife does not.

He can set up SEP-IRA which would really only apply to him since she doesn't have income and the company would contribute 25% of his salary to the SEP account. Now can he also contribute his maximum of $6000 to another IRA account for him and one for his non working spouse?

Linda

[joanmcq]

It depends on his income. He will fall under the income limitations for deductible IRA contributions for someone with another retirement account. She will fall under the limitations for a spousal IRA. Of course both could make nondeductible contributions.