I am mulling over some future opportunities that may make this something that is possible.
The maximum that can go into a 401(k) in 2017 is $60,000, which consists of $18,000 in deferred compensation (i.e., taken out of your check), a $6000 catchup (I turn 50 this year), and a total maximum of $54,000, which is $60,000 in my case, due to the catch up provision.
Assume I own a corporation that is taxed as an S corp. I own it. I have no employees other than myself.
This means $24,000 taken from wages, and $36,000 corporate match.
The $60,000 is limited, however. The total match cannot be more than 25% of W-2 income.
This is where my question arises. My calculator tells me that $36,000 x 4 = $144,000.
So, if I pay myself $144,000, I can put away the entire $60,000 in 2017?
Is the $144,000 reduced by the $24,000 I have taken from my paycheck, or is the entire $144,000 counted for purposes of determining whether I can sock away the extra $36,000 as a match?
So I would need enough revenue to pay myself $144,000 and to make the corporate match, another $36,000, after all of my other expenses.
Does this all look correct? My main question is whether the payroll deductions reduce my W-2 income, or not, but any of you smart people are welcome to chime in with any additional information I have overlooked. Thank you.