Stands for Simplified Employee Pension plan. It’s a variation of an IRA just for businesses. The most important difference between a SEP and a 401(k) is that 100% of the contributions are made by you as the employer, not your employee. As of 2016, you could contribute up to 25% of an employee’s compensation up to $265,000 for a maximum contribution of $53,000 (25% of $265K is $53K, so that’s the max you can put in).

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