I am the sole member of first LLC, and I've been doing SEP contributions for several years now.

In 2018, I want to start a second LLC where there will be a second member (let's call him John) who will own a relatively small amount (say 5%).

My understanding is that for 2018, the second LLC is obligated to make SEP payments to John (even if John doesn't want them), and that I can't treat the two LLCs separately.

Suppose in 2018, the first LLC has profit of $200k and the second LLC has profit of $100k, and that I would like to max out my own SEP contribution to $54k.

If the second LLC must contribute to John's SEP:

  • What would the minimum amount be?
  • Would there be a maximum limit other than regular IRS contribution limits?

I'm curious if there is an acceptable range or a fixed number and how to figure this out...

You must log in to answer this question.

Browse other questions tagged .