Solo 401(k) Plan
- Contributions can’t exceed $56,000
- For self-employed, owner-only businesses and partnerships
- Must file paperwork once assets reach $250,000
Solo 401(k) you are both employer and employee, business owner can contribute both:
- Elective deferrals up to 100% of “earned income” up to annual contribution limits, which is $19,000 in 2019
- 25% of compensation, which the IRS defines as net earning from self-employments minus one-half of your self-employment tax and minus the contributions you make to your retirement plan.
Total contributions cannot exceed $56,000.
Owners’ spouses also may participate.