SEP Payment

What is the name of your state?OR


Part of this year my husband worked for a company that offered a SEP. Before he left, his boss (the president of the company) stated that they would be offering 25% this year, instead of the standard 15%. In the recent weeks, they had an employee of theirs (just an employee, not a benefits administrator or an officer of the company or an HR person) contacted us and asked for our SEP bank information and mailing address so that they could mail us the check. When we received it, it was the standard 15%. We do not trust this previous employer and definitely think that they would cheat us if they thought they could get away with it. So my husband emailed the employee that they had contact us and asked him if he received a 15 or 25% contribution to his SEP this year. The president emailed us back telling my husband that it was inappropriate of him to address any questions regarding his SEP to this employee and spouted off that they were only legally obligated to give the final amount of the SEP when they file their taxes.

My husband and I very wary that they will cheat us. Is there a way for us to find out how much they have given or will give to their other employees, and as well if/when they file their year end taxes?

Thanks

Based on the information you gave us:

You may not like this answer, but first, why did you give your bank information to someone over the phone at all, least of all to someone who was not the Benefits Administrator? At the minimum, there should have been a form you completed authorizing them to directly deposit your funds. Otherwise, you should have just expected a check. If they were going to "mail you a check" nobody needed your bank info anyway. This sounds fishy to me at best, and leaves you open to identity theft at worst.

Second, I would have bypassed "the person that they had call you" and spoken directly to the Benefits Administrator or president.

Unless you have a contract guaranteeing the 25% instead of 15% (or, in fact, any contribution at all), I don't think you have any legal recourse. What Joe got is irrelevant to you, and I advise you not to use this information when contacting the company. It's kind of like salary negotiations; comparing yours to someone else's is just not good business sense.

I don't know if you have any rights to review the corporate tax return, unless perhaps if they are a publicly held corporation, but in any case, I don't believe you don't have a legal right to know what Joe or anyone else actually received.

Well, this is a very small company and so we just figured that this was what they asked. We provided the information via email. They needed to mail a check but it was supposed to be payable to the bank, because it's a SEP deposit.

And as far as SEP deposits go, what they do for one they must do for all. From our understanding of the IRS documents we've read if they give Joe Blow a 25% deposit they have to give every eligible employee the same.

I appreciate any information as far as being able to double check all of this. This company will cheat us if they have the chance because they have tried before.

OK, I see the requirement now. This might change my mind somewhat regarding using Joe's information, but I still would not do it until you got the check. Can you request the check be made payable to you and overnight-ed to your home directly? Unless, of course, you're rolling it over to defer income taxes.

Sorry for the misinformation.