1

This money.SE question and this BogleHeads forum thread both seem to ask about whether or not you can contribute to both a SEP-IRA and a Solo 401(k) at the same time for the same business. I'm not getting a clear answer anywhere.

If it matters, this is in regards to an LLC filing under Subchapter S. I'm hoping I can do a SEP-IRA now, and set up a Solo 401(k) if I hit the SEP-IRA limit. Can I do this?

0

You can contribute to both but the total contribution is capped:

More than one plan. If you contribute to a defined contribution plan (defined in chapter 4), annual additions to an account are limited to the lesser of $53,000 or 100% of the participant's compensation. When you figure this limit, you must add your contributions to all defined contribution plans maintained by you. Because a SEP is considered a defined contribution plan for this limit, your contributions to a SEP must be added to your contributions to other defined contribution plans you maintain.

Source: https://www.irs.gov/pub/irs-pdf/p560.pdf on page 6.

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.