A Simplified Employee Pension Individual Retirement Account, or SEP IRA, is a type of retirement plan designed for self-employed individuals and small business owners. It allows employers to make tax-deductible contributions to their employees' retirement savings, including their own. Contributions are made directly to the SEP IRA accounts of eligible employees, making it a straightforward option for retirement planning. One of the key benefits of a SEP IRA is its high contribution limits compared to traditional IRAs. For 2023, employers can contribute up to 25% of an employee's compensation, with a maximum limit of $66,000. This flexibility makes SEP IRAs an attractive choice for those looking to save for retirement efficiently.