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emc011075
emc011075, Tax adviser
Category: Tax
Satisfied Customers: 2308
Experience:  IRS licensed Enrolled Agent and tax instructor
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What is the calendar deadline to set up and fund a 401K tax

Customer Question

What is the calendar deadline to set up and fund a 401K for the tax yr 2015 for a sole proprietor?
My family has come into a windfall from exercising a stock option ($100,000) from my wife's employer. I am an independent insurance broker. I have no ira or 401K set up for myself my wife has both in her name. I am 67 she 62
If we file jointly can I use this money to fund MY 401K
Ignoring this windfall $ our total taxable will come in at $175000
About how much can I put into the 401K?
Submitted: 12 months ago.
Category: Tax
Expert:  emc011075 replied 12 months ago.

Hi. My name is ***** ***** I will be happy to help you.

The deadline for establishing a sole 401K is December 1 (or the end of your fiscal year, if you do not use calendar year). The contribution deadline is April 15 (of October 15, if you file an extension). The maximum you can contribute is your net self-employment profit up to 24K (if you are 50 or older) plus you can make nonelective contribution up to 25% of your net self-employment profit. Your total contribution cannot be more than 53K plus 6K catch up contribution (50 and older)

Expert:  emc011075 replied 12 months ago.

Assuming your spouse is covered by a retirement plan at work, you can still make a deductible IRA contribution in addition to sole 401K, as long as your joint AGI (adjusted gross income) is less than 183K. Between 183K and 193K you would still get a partial deduction.

Expert:  emc011075 replied 12 months ago.

I see you read my respond. Do you have any questions? Is there anything else I can help you with today?

Expert:  emc011075 replied 12 months ago.

And if this answered your question, please take a moment to rate my response so that I may receive credit for assisting you today. However, if you need clarification, or want to discuss this issue further, let me know. Thank you.

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