If an Employer's Contribution to a SEP IRA Is Less

question 64

True/False

If an employer's contribution to a SEP IRA is less than $56,000 in 2019 (or 25% of the employee's earned income, if less), the employee can contribute the difference.

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Definitions:

Direct Materials Cost

The cost of raw materials that are directly used in the production of a product.

Factory Overhead Cost

Indirect manufacturing expenses that are not directly tied to the production of goods, like utilities and salary of supervisors.

Direct Labor Cost

The total cost of all labor directly involved in the production of goods or services, excluding indirect labor costs.

Wages Paid

The total amount of money paid to employees for work performed, typically expressed as an hourly rate or salary.