Can each employee choose a different financial institution for his or her SEP-IRA?

That depends on the simplified employee pension (SEP) plan the employer chooses. Each employee (including the business owner) eligible to participate in the SEP generally must establish his or her own SEP-individual retirement account (IRA) to receive employer contributions. Although the law does not require each participant’s SEP-IRA to be at the same financial institution, the institution that offers or administers the SEP may require the employer to deposit SEP contributions initially into SEP-IRAs maintained at that institution. Employers should read the SEP plan document carefully and make sure they understand the plan’s terms before signing.