Chartered Retirement Planning Counselor (CRPC) Practice Exam 2025 – Comprehensive All-in-One Guide for Exam Success!

The ability for an employer to set up a Simplified Employee Pension (SEP) and make contributions by the due date of the employer's tax return, including extensions, is due to the flexibility provided in the IRS guidelines. This allows employers to assess their financial situation for the year before determining their contributions, providing an added benefit for budgeting and cash flow management.

Establishing a SEP plan can be done anytime up until the tax-filing deadline for the employer’s return, which may also include any extensions granted. This means an employer can wait until the last minute of the tax season to establish a plan and contribute for the previous year, making it highly advantageous for those unsure about their financial stance.

The other options do not reflect the specific conditions set out by the IRS for SEP plans. Establishing a SEP solely on specific dates, throughout the year or limited to January 1st, does not align with the regulatory framework governing these retirement plans and the contribution timelines.