Simple + 401(k)
I was able to find information on multiple plan contribution limits on previous postings but still had three questions.
1. Does the $54,000 2017 cap apply separately to the Simple IRA then separately to the 401(k)? For example employer contributions could be $54,000 for the 401(k) and $54,000 for the Simple IRA for a total of $108,000?
2. Does the $54,000 cap just apply to employer contributions? In short the maximum 401(k) contribution is the employer contribution of $54,000 plus $24,000 (assuming over 50) deferred contribution allowed, less the deferred contribution to the Simple IRA say $15,500 for a total of $62,500?
Note: the Simple IRA income is from a partnership and the 401(k) income is from Sch C.
Many thanks as always.
Mary
Permalink Submitted by John Peterson on Wed, 2017-10-11 21:43
Need more information:1. Are the partnership and Sch C proprietorship in a controlled group (what % do you own in the partnership and what is it’s business?)2. Are you age 50 or above?3. Does the SIMPLE provide the 2% profit sharing or 3% match employer contribution?
Permalink Submitted by Mary K. Dean on Sun, 2017-10-15 06:15
Thanks JM. I was a 51% partner until 12/31/2016. The income was 2016 earnings paid in 2017. I ceased to be a partner 12/31/2016. I am a “fee only” planner. Now I am a consultant for the same firm. The 401(k) was established this year for the consulting income. I can accept other clients than my old firm. I am over 50. The SIMPLE has the 3% employer match contribution.