Author Topic: landlording qualify for sep-ira?  (Read 1599 times)

PAstash

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landlording qualify for sep-ira?
« on: April 10, 2016, 03:42:55 PM »
So I purchased a rental property renovated it with my SO. We will have it paid off in a year we are living there two years to beat the capital gains tax on the sell of it in case we don't like landlording.

I have a 40 hour a week job. can I be a landlord on the side an contribute to a sep-IRA? what are the restrictions on that if possible? sorry if this is not the right place to ask this.

I am already contributing to a 457 plan though my work a IRA and a brokerage account via vanguard.

Jim2001

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Re: landlording qualify for sep-ira?
« Reply #1 on: April 10, 2016, 05:04:28 PM »
PAstash,

  The guidance I've received from my CPA is that unless the majority of my income comes from active real estate activities, income from rental properties is considered passive.  So, I don't think you can use it as a basis for the SEP-IRA.  Of course, different CPAs have different interpretations, so check with yours. 

Let us know what yours says.

NoNonsenseLandlord

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Re: landlording qualify for sep-ira?
« Reply #2 on: April 12, 2016, 08:12:48 AM »
You can only do a SEP with active income.  Pay yourself with a 1099, pay the 15.3% self employment income tax, and put it in a Roth.  That may be a better plan than a SEP.

You are betting the tax rates will be 15+ higher in the future.
« Last Edit: September 06, 2016, 06:06:07 PM by NoNonsenseLandlord »

PAstash

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Re: landlording qualify for sep-ira?
« Reply #3 on: April 12, 2016, 12:27:17 PM »
thanks this is more or less what i was looking for.