Thanks for posting this, Johanna. My wife just set up her dental practice and has two employees. I am wondering if you can help me determine if she can contribute to a SIMPLE IRA. The sticking point is I am not sure we have earned income. She is set up as a LLC and makes enough to make “draws” to cover living expenses. However, because of various deductions from a newly established practice, the LLC will show a loss for the year. Because of this, does that mean she doesn’t have earned income and therefore cannot contribute the $12500 to the IRA? Or, does she have earned income because she is making draws from the business for living expense. Thanks in advance.
The withdrawals do not count as expenses, therefore, it sounds as if she might have enough income to contribute to a SIMPLE IRA. I'm glad you liked the articles.
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