Question

About late 401K employer contribution for my solo 401K

Forum|Forum|3 years ago
August 27, 2022
1 reply
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I only have 15,000 in my solo 401K so far and I filed the 2021 tax on time this year without filing any extension. I'd like to contribute more to my solo 401K as an employer contribution for 2021 since I am amending/increasing the salary I paid myself last year. And the company managing my solo 401K allows me to do so. Can I do the contribution? If not, what is the consequence of the late 401K contribution for my solo 401K plan? Thanks!

Not A Product Question

M

Mike9241

not sure what type of entity you have and I'm not sure exactly how you can after year-end retroactively increase your salary. the company managing my solo 401K allows me to do so - they don't write the tax laws. what can they cite in the tax laws to justify this.

here are four important dates that involve Solo 401k contribution deadlines

1) March 15, 2022, is the federal tax filing deadline S-Corporations and partnership LLCs, and the Solo 401k contribution deadline
2) April 18, 2022, is the federal tax filing deadline for sole proprietors, single member LLCs, and C-corporations and the Solo 401k contribution deadline for those business types.
3) Both of those dates (March 15th and April 18th) are also the deadlines for filing for a six-month extension that also allows for extensions to the Solo 401k contribution deadlines. The respective extensions are until September 15, 2022, and October 17, 2022.

so it would seem you can no longer make an additional tax-deductible Solo 401k contribution for 2021. if you did make such a contribution for 2021 it would likely be subject to a 10% PENALTY every year until corrected.