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DeluxeXL t1_iy67kn1 wrote

No. Since your business is a S corp, you can't fudge ownership like a sole proprietor. This means if you did not defer any of your monthly paychecks to 401k, you missed it. However, your business can still make profit sharing contributions (subject to the 25% limit) by tax day.

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debbiewith2 t1_iy69t4b wrote

Isn’t it too late, even with extensions (Sept 15)?

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DeluxeXL t1_iy6a1t3 wrote

Yea it is too late for 2021. But not too late for 2022!

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throwaway72646w t1_iy68o2f wrote

I do a year end lump sum solo 401k contribution every year. I'm a S Corp and my Solo 401k is with Fidelity.

I'll max it out with the 19,500, now 20,500 a year in a paycheck but you'll have to pay more like 25,000 or whatever to account for some taxes to get the full 20,500 contribution limit.

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[deleted] OP t1_iy6981n wrote

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throwaway72646w t1_iy6ei1j wrote

Yes, I just switch the contribution amount to 100pct to the deferred retirement plan part in my payroll processor for that pay period. Pay myself a $23,000 check (or whatever the amount is) and after taxes are taken out from the state and the employer side, it'll be the full contribution amount. You'll have to fiddle with the gross numbers to get the full contribution amount.

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kaartman1 t1_iy6xljm wrote

I have S corp taxed as LLC. Your employer portion of 401k contribution can not exceed 25% of paycheck and you can contribute your portion of 401k only when it is line item in your pay check.

Employer portion can be deposited in lump sum before year.

You portion can also be deposited in lump sum but it has to recorded in your paycheck.

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[deleted] OP t1_iy6y3f7 wrote

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kaartman1 t1_iy6ylxc wrote

Do you use any 3rd party service or app to run pay check? May be there is a loophole ( void it and rerun citing some mistake… forgot to add 401k contributions).

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[deleted] OP t1_iy6z5nf wrote

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kaartman1 t1_iy6znxf wrote

I am sure there will be a way to amend it. Call them and explain. I am sure mistakes like this happen all the time. Worse case …run remaining pay checks for huge amount and contribute all of it towards your portion of 401k.

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[deleted] OP t1_iy706dl wrote

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mnico213 t1_iy8klqu wrote

For whatever it’s worth, with an S Corp your salary needs to be reasonable with regards to the services you are providing to the corporation. The IRS does not allow you to just avoid payroll taxes by being an S Corp.

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MikeWPhilly t1_iy9nlte wrote

This is even more critical with the increased scrutiny on taxes soon. I’m expecting S Corp to be a fun target for audits.

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just_a_bud t1_iy719lx wrote

Is there a reason you opted for a 401(k) ESP? Are you going to do Roth contributions?

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[deleted] OP t1_iy7276k wrote

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just_a_bud t1_iy937d7 wrote

You could’ve done that with a SEP or SIMPLE IRA without the cost of administering a 401(k). I usually advise SEP for solo owners. You probably spent money unnecessarily starting a solo 401(k).

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jiggajim t1_iy87re0 wrote

Yes. I use Gusto and do an off-cycle payroll at end of year for the appropriate amount to match (plus payroll taxes etc). But you need to still follow the matching rules, so sometimes that EoY check can be a doozy.

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jiggajim t1_iy8gwpq wrote

Wanted to amend, I also do this with my spouse. One single off-cycle paycheck at the end of year, as a spouse can also be included in your Solo 401k. Then the spouse has their contribution maxed out plus employer contribution (subject to % rules).

I used to contribute each paycheck but it's easier to do this at the end of the year, as you can decide exactly how much you're able to contribute based on how your business has performed.

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mormonjudy t1_iy8exxb wrote

You could make a voluntary after-tax contribution in one lump sum like that if your plan allows it.

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