Distributions of Income for a LLC with S-Corp Status

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November 13, 2024
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I have an LLC that is an S Corp for tax purposes. I employ my husband in the business. We both are earning a reasonable salary through the LLC and I have set up a solo 401k that the LLC is contributing into for both of us. Can you help me better understand the following: 1) I believe I can get a distribution of net earnings made to me by the end of the year? What about my spouse? 2) It is also my understanding that I can contribute to the 401K in excess of the individual withholding limits for both of us? Can you help provide more insight here?

Ask the Experts - Biz Tax Moves - Nov 2024

mblumenthal

An LLC can contribute to a 401(k), specifically through a "Solo 401(k)" plan if the LLC is considered a single-member entity with no other employees besides the owner (or possibly their spouse), allowing them to contribute as both the employee and employer to their retirement account;. I am not sure about your question concerning distributions. This can be done anytime.