Suppose I have a schedule C sole prop. business that nets $40,000. I created a SEP-IRA that I make contributions to, from this business.
And suppose I have a second schedule C sole prop. business that has a loss of $10,000.
These get combined on the 1040 to show income of $30,000.
When I calculate the maximum SEP-IRA contribution that I can make, do I use the $40,000 number from business 1, that I created this SEP-IRA for?
Or do I use the combined net of $30,000 from both businesses?
Thanks.