Ken is a self employed architect in a small firm with four employees himself, his office assistant, and two drafters, all of whom have worked for Ken ful time for the last four years The office assistant earns $30,000 per year and each drafter earns $40,000 Ken's net earnings from self employment (after deducting all expenses and one half of self employment taxes) are $350,000 Ken is considering whether to establish a SEP plan and has a few questions Assume that all the employees are at least 21 years old Required a Is he eligible to establish a SEP plan b Is he required to cover his employees under the plan d If the employees are not covered, what is the maximum amount Ken can contribute for himself e If Ken is required to contribute for his employees and chooses to contribute the maximum amount, what is the maximum amount Ken can contribute for himself (Hint Calculate the employee amounts first ) lgnore any changes in Ken's self employment tax

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Ken is a self employed architect in a small firm with four employees  himself, his office assistant, and two drafters, all of whom have worked for Ken ful time for the last four years  The office assistant earns $30,000 per year and each drafter earns $40,000  Ken's net earnings from self employment (after deducting all expenses and one half of self employment taxes) are $350,000  Ken is considering whether to establish a SEP plan and has a few questions  Assume that all the employees are at least 21 years old  Required  a  Is he eligible to establish a SEP plan  b  Is he required to cover his employees under the plan  d  If the employees are not covered, what is the maximum amount Ken can contribute for himself  e  If Ken is required to contribute for his employees and chooses to contribute the maximum amount, what is the maximum amount Ken can contribute for himself  (Hint  Calculate the employee amounts first ) lgnore any changes in Ken's self employment tax

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Ken is a self-employed architect in a small firm with four employees: himself, his office assistant, and two drafters, all of whom have worked for

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