QUESTION: Okay, I want to open a Solo 401k this by the end of the year so, I will start the process. However, I am a little confused about how much I can put into my Solo 401k.
I have a regular 401k plan where I am employed full-time. I will have contributed 12k.
I have a second job as an independent contractor doing physical therapy work in a C-corp and I will probably pay myself a salary between 4k and 5k. Can I put all of that in the self-directed solo 401k? Then make the profit sharing Solo 401kj contribution before I file my corp. tax return.
Thanks,
G L
ANWER: Those self-employed and doing business under a C-corporation calculate both contribution types (salary deferral and profit sharing) based on W-2 income.
Further, the Solo 401k contribution rules permit contributions to multiple 401k plans; however, you cannot exceed the annual contribution amount, which, for example, is $50,000 plus an additional amount of $5,500 if you are age 50 or older in 2012, between all 401k plans. Therefore, you can contribute to both your day job 401k and your self-employed 401k.
Visit Solo 401k contribution calculator for calculating your Solo 401k contribution.
I have a regular 401k plan where I am employed full-time. I will have contributed 12k.
I have a second job as an independent contractor doing physical therapy work in a C-corp and I will probably pay myself a salary between 4k and 5k. Can I put all of that in the self-directed solo 401k? Then make the profit sharing Solo 401kj contribution before I file my corp. tax return.
Thanks,
G L
ANWER: Those self-employed and doing business under a C-corporation calculate both contribution types (salary deferral and profit sharing) based on W-2 income.
Further, the Solo 401k contribution rules permit contributions to multiple 401k plans; however, you cannot exceed the annual contribution amount, which, for example, is $50,000 plus an additional amount of $5,500 if you are age 50 or older in 2012, between all 401k plans. Therefore, you can contribute to both your day job 401k and your self-employed 401k.
Visit Solo 401k contribution calculator for calculating your Solo 401k contribution.
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