In the U.S., SEP also stands for Simplified Employee Pension, a type of IRA (Individual Retirement Account) for small business employees and the self-employed. Like any IRA, SEPs are tax-deferred, so contributions don't count toward taxable income.

The SEP belongs to a family of small-business retirement plans that also includes SIMPLE and Keogh plans. Of these, the SEP is probably the simplest to set up and maintain, and the most economical. At the time of writing, tax-deferred SEP contributions are limited to 15% of income, to a maximum of $24,000 per year.