I have a client contributing to his SEP as a self-employed person. He wants to roll some of it over to another investment he has that is a Traditional IRA. But he also wants to continue contributing to this SEP account each year. Can he do that, or does he have to shut down his SEP plan prior to rolling it over into an IRA?
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Partial Transfer of SEP Assets to IRA
Yes. It is acceptable for most mutual funds to do a partial transfer of assets from a SEP to a traditional IRA.
As long as he meets the other rules for a SEP new money can go into the SEP even after some of the funds were transferred to his IRA.
This information was obtained from the American Funds.
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