To generate the Self-Employed Pensions (SEP) Worksheet (Wks SEP) in the View/Print mode of a 1040 return, enter the plan contribution rate on the SEP screen. Be sure to select the appropriate schedule in the drop list for the SEP amount to be included in the relevant QBI calculation worksheet(s).

The deductible amount then flows to Form 1040:

• Schedule 1, line 16 in Drake Tax 2021 and future

• Schedule 1, line 15 in Drake Tax 2019 and Drake Tax 2020

Notes:

• For a self-employed individual, contributions are limited to 25% of your net earnings from self-employment (not including contributions for yourself), up to:

  • $69,000 for 2024

  • $66,000 for 2023

  • $61,000 for 2022

  • $58,000 for 2021

  • $57,000 for 2020

• To complete a separate Wks SEP for taxpayer/spouse (or for multiple businesses for a taxpayer), press Page Down to produce a new SEP screen and use the TSJ box to designate which data belongs to which taxpayer.

  • Select the relevant schedule (For box) and Multi-form Code in the Qualified Business Income section to tie the SEP screen to the applicable business.

• SEP and QBI:

  • If there is only one business for each taxpayer, the QBI worksheet will show the same amount as Wks SEP for that taxpayer.

  • If there are multiple businesses, Wks SEP will show the total for each taxpayer and then the QBI worksheet will show only the amount figured for that business.

See Publication 560, Retirement Plans for Small Business, for more information regarding SEP contributions and deduction limits.