SEP contribution

[oceanlovin'ea]

I just realized that one of my client's did not put the SEP contribution for 2009 in her IRA account.

I just noticed the balance on the SEP payable account and it is double what it should be.

What do I do now?

Linda

[BHoffman]

I just realized that one of my client's did not put the SEP contribution for 2009 in her IRA account.

I just noticed the balance on the SEP payable account and it is double what it should be.

What do I do now?

Linda

Hi Linda - If I'm understanding this, you will need to confirm with the client that she did not pay into her SEP for 2009. If she didn't, then I think the 2009 payable is reversed on the 2009 books and the 2009 return is amended. There are other questions I would have, and I'm giving you a bump

[oceanlovin'ea]

That is what I was afraid of.

I have her bookkeeping for the whole year of 2010 and there is not a check to the bank for the amount she should have put in the account.

Linda

[BHoffman]

I'd still ask her just to make sure she didn't fund the thing with her home equity line of credit or personal check or something.

[oceanlovin'ea]

checked with her today

She did not make the contribution to her IRA last year. She was moving IRA's from one institution to another and just got confused. She will be 90 in March and still is actively running a business. I should have kept better track of what was going on.

Don't guess IRS would have any pity on an 89 year old being forgetful.

Linda

[BHoffman]

Linda - I don't know about these days, but the friendlier IRS of yesterday used to forego imposing penalties on voluntarily amended returns.

[oceanlovin'ea]

Thanks

Thanks BHoffman. I will definitely try that when we get to that point. She asked me today why she couldn't just put it in now. So I hope I can get her out of penalties.

Linda