Company contribution to solo 401 k box

Who can contribute to a solo 401(k) plan?

A quarter of the participant's self-employment compensation (or 20% in the case of a sole proprietor or single member LLC) may be contributed to the Solo 401 (k) plan. Employer contributions are made by the business and are 100% elective but must be made prior to the business filing its tax return.

How do I report a Solo 401k contribution to the IRS?

If so, submit both contributions to the IRS on your personal tax return. For these businesses, your income is calculated using Schedule C. Report the employer and employee contribution to the Solo 401k on Schedule 1, line 16 of the IRS tax form 1040. Important note: you do not report the employee portion of the Solo 401k contribution on Schedule C.

Can a solo 401(k) be used as an employee?

However, in a solo 401 (k), you play both roles, so you can make both contributions. For 2024, you're allowed to elect to defer $23,000 of your self-employment income as an employee contribution, and this limit is increased to $30,500 if you're over 50 to allow you to "catch up" on your savings. The limit increased from $22,500 in 2023.

Can a solo 401(k) plan include a profit-sharing contribution?

As the employer, you can make an additional contribution known as the profit-sharing contribution. A quarter of the participant's self-employment compensation (or 20% in the case of a sole proprietor or single member LLC) may be contributed to the Solo 401 (k) plan.

Does a Solo 401k plan need to file a tax return?

Your Solo 401k retirement plan is tax deferred. Therefore, it doesn’t file a tax return. There is often no direct filing requirement for your Solo 401k. Only after the Solo 401k Plan balance exceeds $250,000 in assets (including all liquid cash and non-liquid assets), is there a simple filing requirement for IRS form 5500-EZ.

Can I rollover money into a Solo 401k?

No, you can rollover any amount at any time into your Solo 401k plan. Funds you roll over into a Solo 401k do not count against or reduce yoru contribution amount. Contributions are solely based on your compensation from your small business. Did this answer your question?