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Learning, Sharing, and Teaching => Investor Alley => Topic started by: kpd905 on November 05, 2016, 08:21:16 PM

Title: Solo 401k with Multiple 1099 Sources?
Post by: kpd905 on November 05, 2016, 08:21:16 PM
I always seem to find a few different ways to make some 1099 income, and I was wondering if I can open up a solo 401k and make employer contributions using the combined income from all of the sources.  I am working for Appen Butler Hill and also selling tradeline spots.  I won't make much this year but might hit $15,000 next year with some luck, so if I am calculating correctly it would be $2541 of tax advantaged space total.  ($15,000-15.3% SE tax X .2)

Also, to anyone that has set one up before, is it time consuming compared to setting up an IRA?
Title: Re: Solo 401k with Multiple 1099 Sources?
Post by: Interest Compound on November 06, 2016, 10:07:35 AM
Disclaimer: I am not a layer, nor am I authorized to give tax advice.

It doesn't matter how many people are sending you a 1099, as long as they all fall under the same business. That business could be "kpd905 LLC", it could be "kpd905's sole proprietorship (easiest)"...etc.

In my experience, setting up a solo401k is no big deal, just signing a few forms, and the additional tax-sheltered space is a great boon to our finances. No reason not to do it.
Title: Re: Solo 401k with Multiple 1099 Sources?
Post by: MidWestLove on November 06, 2016, 01:11:08 PM
setting up IRA and solo 401k is very easy - every major discount broker or organizations like Vanguard will do it for you within a week at most. I posted this in tax section earlier - run this calculator

https://personal.vanguard.com/us/SbsCalculatorController

amount of 1099s does not matter assuming if is the same business (i.e. you working for yourself as sole proprietor)

Title: Re: Solo 401k with Multiple 1099 Sources?
Post by: kpd905 on November 06, 2016, 03:47:12 PM
Great, thanks both of you.  It would be a sole proprietorship for both, so I will look into this.
Title: Re: Solo 401k with Multiple 1099 Sources?
Post by: DavidAnnArbor on November 07, 2016, 06:50:07 AM
You'll need a tax id number for the solo 401k but it was no big deal. Any of the companies will help you, I used Fidelity.