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Started By
Message
Clarification on contribution limits
Posted on 11/25/21 at 10:10 pm
Posted on 11/25/21 at 10:10 pm
I think the answer is yes, but I want to confirm this situation.
Background:
I currently am employed, but have a slightly different 1099 job as well. The vast majority of my funds come from my W2 job, but an additional 30k a year is the 1099.
I currently max my 401k, receive a partial employer match (12k), and backdoor an additional 6k in a Roth.
Question:
Can I also contribute another 25% of 1099 money as an employer portion to a SEP?
It wouldn't be a ton, but would be another 6-9k per year in a tax deferred account.
Background:
I currently am employed, but have a slightly different 1099 job as well. The vast majority of my funds come from my W2 job, but an additional 30k a year is the 1099.
I currently max my 401k, receive a partial employer match (12k), and backdoor an additional 6k in a Roth.
Question:
Can I also contribute another 25% of 1099 money as an employer portion to a SEP?
It wouldn't be a ton, but would be another 6-9k per year in a tax deferred account.
3
Posted on 11/26/21 at 6:39 am to GeauxTigers777
Posted on 11/26/21 at 7:06 am to GeauxTigers777
My hunch is yes. I have a SEP with Wealthfront. Don’t have W2 income. Wealthfront’s interactive questionnaire is pretty good about steering you to the right account when setting up. If I were in your shoes I’d just follow all the steps on their site and see if I can open one for sure.
Pretty sure you can do this without actually opening an account.
Pretty sure you can do this without actually opening an account.
Posted on 11/26/21 at 12:06 pm to GeauxTigers777
quote:Yes. Your contribution to your SEP does not count towards the contribution limits to your 401k.
Can I also contribute another 25% of 1099 money as an employer portion to a SEP?
Keep in mind, when calculating the 25% for your SEP, make sure you're using your net earnings from self-employment less the deductible portion of self-employment tax, and the amount of your own retirement plan contribution deducted on the 1040.
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