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Posted by JGE on March 17, 2008, 8:28 pm
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I have a W-2 job with a 401K funded by paycheck deductions. I also
have 1099
income from self-employment. Is it true that the annual 401K limit
applies
to the SUM of these two ? In other words, if I have max'ed out the
401K
off my W-2 job, then it's pointless to open an individual 401K ?
(Yes, I realize
I can still do a SEP-IRA from the 1099 income).
Thanks, John
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Posted by Rich Carreiro on March 17, 2008, 10:31 pm
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> I have a W-2 job with a 401K funded by paycheck deductions. I also
> have 1099 income from self-employment. Is it true that the annual
> 401K limit applies to the SUM of these two ?
Yes and no. The employEE salary deferral limit is the sum of those two.
But each employER matching plan stands alone.
> have max'ed out the 401K off my W-2 job, then it's pointless to open
> an individual 401K?
While you can't make any employEE contribution to your solo 401(k),
you can still make the 20% max employER profit-sharing contribution
to your solo 401(k).
--
Rich Carreiro rlc-news@rlcarr.com
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by removeps-groups@yahoo.com on March 18, 2008, 1:04 am
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> While you can't make any employEE contribution to your solo 401(k),
> you can still make the 20% max employER profit-sharing contribution
> to your solo 401(k).
Is it true that the net amoutn you can put into all your 401k and
SEP's, employee and employer portions, must be less than 45k (or
whatever the max limit for SEP IRA's is now)?
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by Phil Marti on March 18, 2008, 2:33 am
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> Is it true that the net amoutn you can put into all your 401k and
> SEP's, employee and employer portions, must be less than 45k (or
> whatever the max limit for SEP IRA's is now)?
No. That limit is per plan, not per person. The $15,500 limit on salary
deferrals is per person.
--
Phil Marti
Clarksburg, MD
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by JGE on March 18, 2008, 4:10 pm
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Thanks for all the discussion, but I'm starting to get confused.
Let me phrase my question in a completely different way ...
1. This year, I'll earn about $30K in a W-2 job.
2. I'll also earn about $15K in consulting (1099-MISC).
3. I've already max'ed out my 401K ($20,500) from the W-2 job.
4. I wish to tax defer as much income as possible.
How can I best accomplish #4 ?
Also, I've already made my max Roth IRA contribution, and I have
a pre-existing SEP-IRA, to which I've made no contribution as yet.
Thanks, John
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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