Simplified Employee Pension (SEP) IRA

We're here to support self-employed individuals and small businesses with a simple way to contribute to their employees' retirement.


Contribution guidelines

A Simplified Employee Pension (SEP) plan is ideal for self-employed individuals and small businesses.

  • Contributions1 are made to the participant’s Traditional IRA2
  • Employer contributions are deductible by the employer
  • Employer contributions are discretionary

As an employer, you may set the following employee eligibility requirements or you can choose to be less restrictive and not include some of the requirements below.

  • Employees must be at least 21 years old
  • Employees must have worked three of the immediately preceding five years
  • Employees must earn at least $650 in compensation
  • Employees must not be covered by a collective bargaining agreement
  • Employees who are nonresident aliens with no U.S. income are excluded
  • Eligibility requirements must apply to all employees, including the business owner

Only employer contributions are allowed in an SEP plan and must be made on behalf of all eligible employees.

  • Each employee must establish a Traditional IRA
  • Contributions must be made by the business’ federal tax return due date, to include extensions
  • Contribution limits per employee is the lesser of:
  • 25% of the employee's compensations (up to a defined compensation cap) or
  • A set dollar amount ($61,000 for 2022)

SEP plan contributions and earnings are tax-deferred3 and subject to the same rules as Traditional IRAs to include moving, withdrawing,4 or converting assets.

To learn more, contact us today by calling 915.774.6879, toll-free at 1.800.772.4328, ext. 6879.


We’re Here to Answer Your Retirement Savings Account Questions
  • How can I open an SEP IRA?
    To get started, call a GECU representative at 915.774.6879, toll-free at 1.800.772.4328, ext. 6879.
  • What is a Simplified Employee Pension (SEP)?
    A SEP is a written arrangement that allows an employer to make deductible contributions to a Traditional IRA set up for their employee to receive contributions.
  • Are my deposits insured?
    Yes, your deposits are insured by NCUA up to $250,000.
  • What are the employee eligibility requirements for a SEP IRA? 
    If you are interested in establishing a SEP plan, consult your tax and legal advisors for guidance in selecting the plan features that best suit your business' needs.
Membership eligibility is required.
1Contribution limits vary and depend on your individual income level.
2To open an IRA, you will need to make an appointment with the Special Services Department.
3Representatives are neither tax advisors nor attorneys. For information regarding your specific tax situation, please consult a tax professional.
4Withdrawals before you are 59½ may result in a tax penalty and interest penalty, except in the case of education IRAs. Consult your tax advisor for details.
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