SEP IRA - previous tax year contributions

[LKS89gs]

Hi all,

I know that contributions for the previous tax year are allowed for SEP IRA accounts up until tax filing date (per https://www.irs.gov/retirement-plans/retirement-plans-faqs-regarding-seps#contributions ). However by default they are classified as contributions for the current year, it seems this can't be easily re-characterized in the way that traditional IRA contributions are (e.g. with a dropdown year selection in the online brokerage account).

When I inquired with my brokerage they advised me to work with a tax professional.. but I'd rather inquire of the knowledgeable folks here, first!

The IRS publication (https://www.irs.gov/pub/irs-pdf/p560.pdf; pg 22) states that contributions can be applied to the previous year if:

You do either of the following.
a. You specify in writing to the plan administrator or trustee that the contributions apply to the previous year.
b. You deduct the contributions on your tax return for the previous year

Do I interpret this correctly that simply by deducting a contribution I made in April 2024 on my 2023 tax return, it will applied to 2023? (my desired outcome)
Should I hunt down a mailing address for my plan administrator to notify them in writing, as well?

Thanks in advance for any guidance you can offer!

[terran]

I can tell you that in a similar situation with a solo 401(k) it was made clear to be that the contribution year functionality was just a courtesy and I was responsible for definitive record keeping, so while they could reclassify the contributions as prior year it wasn't really necessary. I don't know if the same would apply to a SEP IRA.

[LKS89gs]

Thank you for the response, @terran - much appreciated.

Any other insights?

[Sandi_k]

We had this issue at one point with DH - he made a SEP-IRA contribution at Fidelity, for the previous tax year, in April.

In the memo section, he clearly wrote TAX YEAR PREVIOUS.

We got a letter from the IRS, saying he'd underreported income, and in that same amount. We contacted Fidelity and asked them - turned out that they'd credited to the current year.

Since they take pics of all deposits, they pulled it up in their system, saw that we had noted PREVIOUS YEAR on the check, and they corrected it.

We printed out the messages in the message center, and returned it to the IRS with a copy of their letter, and we got a "resolved, thank you" letter some months later.