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TC business · retirementSEP-IRA for transaction coordinators: the 2026 limits and deadline

A Simplified Employee Pension lets a self-employed transaction coordinator put part of each good year away for retirement. For 2026, contributions cannot exceed the lesser of 25 percent of compensation or $72,000; there are no salary deferrals or catch-up contributions in a SEP. For a self-employed person, compensation starts from net earnings from self-employment, reduced by the deductible part of self-employment tax and by the SEP contribution itself – Publication 560 has the rate table and worksheet, so the real percentage of Schedule C profit is lower than 25. You can set up a SEP for a year as late as the due date of that year's return, including extensions, and you do not have to contribute every year.

The rules (irs.gov, Publication 560)

  1. Limit 2026

    The lesser of 25% of compensation or $72,000.

  2. Compensation cap

    Compensation counted for plan contributions is capped at $360,000 for 2026.

  3. Self-employed

    Net earnings minus the deductible half of self-employment tax and minus the contribution – use the Pub. 560 worksheet.

  4. Deadline

    Set up the SEP as late as the return due date for that year, including extensions.

  5. Flexible

    No contribution is required every year; contributions must be money, not property.

Why it fits a TC business

  • Fees bunch in busy seasons – contribute after the year ends, when you know the profit.
  • Simple paperwork compared with a 401(k).
  • The contribution reduces income tax; it does not reduce self-employment tax.

Check before you contribute

  • If you have employees who qualify, a SEP must cover them too.
  • Do not use 25% of Schedule C profit – figure the self-employed rate with Pub. 560.
  • Contributions reduce qualified business income for the QBI deduction.

Questions TCs ask

How much can I put in a SEP-IRA in 2026?

The lesser of 25% of compensation or $72,000 (irs.gov). Self-employed people figure compensation from net earnings with the Publication 560 worksheet.

When is the deadline to open a SEP-IRA?

As late as the due date of your income tax return for that year, including extensions (Publication 560).

Can I make catch-up contributions to a SEP?

No. Elective salary deferrals and catch-up contributions are not permitted in SEP plans (irs.gov).

Related guides

ClosingCode's month close gives you – and your accountant – each month's income and expenses in one package, the numbers a SEP contribution is figured from.

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Sources (read October 25, 2026): irs.gov "SEP contribution limits (including grandfathered SARSEPs)" (updated June 28, 2026); IRS Publication 560 (for 2025 returns; 2026 compensation limit).

General information, not tax advice. ClosingCode is software; it is not a tax preparer, CPA or financial adviser. This guide is not a substitute for the advice or services of an attorney.