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Solo 401(k)

401(k) Contribution Limits & Deadlines

Year Maximum Employee Contribution
(if under age 50)
Maximum Employee Contribution
(if over age 50)
Employee Contribution Deadline
2018 $18,500 $24,500 Deferred from last paycheck or Dec. 31, 2018
2017 $18,000 $24,000 Deferred from last paycheck or Dec. 31, 2017

Year Maximum Contribution
(if under age 50)*
Maximum Contribution
(if over age 50)*
Contribution Deadline
2018 $55,000 $60,500 04/15/2019 (plus extensions)
2017 $54,000 $60,000 04/17/2018 (plus extensions)

*Total employer contributions to a participant’s account, not counting catch-up contributions, cannot exceed $55,000 for 2018.

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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 ("taxable compensation" in the case of a self-employed individual) up to the annual contribution limit:

  • 2018: $18,500 or $24,500 if age 50 or over; and

Employer non-elective contributions up to:

  • 25% of compensation as defined by the plan, or for self-employed individuals, see discussion below.
  • One can contribute to an IRA, move it into a 401(k) account, and contribute in-full to 401(k). However, not all of the contribution would be a deductible contribution.
  • 401(k) employer may make an in-kind contribution to the plan. All other rules still apply - i.e., a disqualified persons may not be securing the loan.
  • Employer matching or non-elective contributions are always made "pre-tax."  Employers cannot make Roth contributions.

Learn more about the benefits of a Solo 401(k).