My wife works as a consultant to a business I operate (a single-member LLC). Can I pay her business (also a single-member LLC) as a vendor? I would treat her payment as a contractor expense, and she would treat the payment as income into her LLC.
If so, can she then contribute this income to a solo 401k? If yes, what contribution limits should she be aware of?
For further background, I contribute to my own solo 401k with my business and an SEP IRA -- in case that makes any difference.