Author Topic: How much can I contribute to my individual 401k?  (Read 1868 times)

freedomquest

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How much can I contribute to my individual 401k?
« on: February 09, 2015, 12:00:24 PM »
I was self employed for the first half of last year and then became an employee of a firm in the second half of the year.  I contributed $11,500 to my employer's 401k and I am trying to calculate my individual 401K contribution while doing our taxes through Turbo Tax.  TT's maximize the contribution function can't take into account the $11,500 I have contributed elsewhere and is overstating my allowable contribution.  If my self employed "income" is $16,400 after expenses and deducting half of my self employment tax, I have estimated my allowable contribution as $6,000 employee and $4,100 employer - does that seem logically correct?

Can I also make a SEP contribution or is that double dipping?

thanks!

terran

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Re: How much can I contribute to my individual 401k?
« Reply #1 on: February 09, 2015, 12:31:46 PM »
http://www.bankrate.com/calculators/retirement/self-employed-401-k-calculator.aspx says $3048 employer and $12,193  employee. I think you would have to count the employee contribution you've made to your new plan towards the $17.5k limit, so I think you'd be limited to $6000 more for your employee contribution.

Did you already set up the solo 401k? I believe it has to be set up by December 31st of the year in which you want to make contributions (at least that's what vanguard told me). Once it's set up you can at least make employee contributions until the tax filing deadline -- not sure about employer contributions. You could still set up a SEP IRA for last year.

freedomquest

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Re: How much can I contribute to my individual 401k?
« Reply #2 on: February 09, 2015, 12:47:18 PM »
Thanks - I have the i401k set up through Vanguard, I just haven't funded it yet.