Solved: 2 person LLC partnership. I am an active member, my wife is a passive member. I have a 401k. What are retirement plan and employer match contribution limits?
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slaksh
New Member

2 person LLC partnership. I am an active member, my wife is a passive member. I have a 401k. What are retirement plan and employer match contribution limits?

Also, can I deposit this money in to the 401k plan for 2016 tax year in March 2017?
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Accepted Solutions
RichardK
New Member

2 person LLC partnership. I am an active member, my wife is a passive member. I have a 401k. What are retirement plan and employer match contribution limits?

Per the IRS website, click here, the 401(k) limits are:

Contribution limits in a one-participant 401(k) plan

The business owner wears two hats in a 401(k) plan: employee and employer. Contributions can be made to the plan in both capacities. The owner can contribute both:

·        Elective deferrals up to 100% of compensation (“earned income” in the case of a self-employed individual) up to the annual contribution limit:

o   $18,000 in 2016 and 2017, or $24,000 in 2016 and 2017 if age 50 or over; plus

·        Employer non-elective contributions up to:

o   25% of compensation as defined by the plan, or

o   for self-employed individuals, see discussion below

If you’ve exceeded the limit for elective deferrals in your 401(k) plan, find out how to correct this mistake.

Total contributions to a participant’s account, not counting catch-up contributions for those age 50 and over, cannot exceed $54,000 (for 2017; $53,000 for 2016)

 

Generally the retirement contribution is made by the due date of the tax return.

View solution in original post

2 Replies
RichardK
New Member

2 person LLC partnership. I am an active member, my wife is a passive member. I have a 401k. What are retirement plan and employer match contribution limits?

Per the IRS website, click here, the 401(k) limits are:

Contribution limits in a one-participant 401(k) plan

The business owner wears two hats in a 401(k) plan: employee and employer. Contributions can be made to the plan in both capacities. The owner can contribute both:

·        Elective deferrals up to 100% of compensation (“earned income” in the case of a self-employed individual) up to the annual contribution limit:

o   $18,000 in 2016 and 2017, or $24,000 in 2016 and 2017 if age 50 or over; plus

·        Employer non-elective contributions up to:

o   25% of compensation as defined by the plan, or

o   for self-employed individuals, see discussion below

If you’ve exceeded the limit for elective deferrals in your 401(k) plan, find out how to correct this mistake.

Total contributions to a participant’s account, not counting catch-up contributions for those age 50 and over, cannot exceed $54,000 (for 2017; $53,000 for 2016)

 

Generally the retirement contribution is made by the due date of the tax return.

View solution in original post

slaksh
New Member

2 person LLC partnership. I am an active member, my wife is a passive member. I have a 401k. What are retirement plan and employer match contribution limits?

Thank you for the clarification. I have a couple of follow up questions.

If I chose to make a $18,000 elective deferral where in Turbo Tax Business software would I enter this? Also, where would I enter any employer non-elective deferral contributions to my retirement in Turbo Tax Business software.

Just to double confirm I have until April 15th to deposit any elective deferral and non-elective employee contributions to my 401k account.
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