The Ultimate Tax-Shield: 11 Proven SEP IRA Strategies for 2025-2026
Self-employed professionals and small business owners face a unique tax burden—income tax, self-employment tax, and state levies with no W-2 withholdings. The SEP IRA emerges as a potent tool to shield earnings, offering deductions far exceeding Traditional IRAs or 401(k)s. Mastering its nuances can unlock tens of thousands in annual tax savings.
Key strategies include leveraging the AGI shield, optimizing 2025-2026 contribution limits, and applying the sole proprietor 20% rule. S-Corp owners must base contributions on W-2 salary, not net earnings. The plan’s flexibility and high ceilings make it a standout for entrepreneurs.