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Showing results for tags 'k-1'.
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We have a client who owns two companies and both have employees including himself. One is a corporation; the other is a LLC. He has W-2 wages of about $190,000 from the corporation and over a million from the LLC. Both companies are adopting employers to the same retirement plan and all employees are covered for both entities. Question: In calculating the maximum benefit he can have for 2017, are we allowed to use both his W-2 wages plus enough K-1 income to get him up to the maximum we can take into account for the year of $270,000? Our gut reaction is "yes" but one of us has some doubts. We are grateful for any help!
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2 S corps own a medical practice as a partnership Each S Corp receives distributions and a K-1 from the practice which 100% of the distributions are invested back into the practice Each S Corp pays the owners W2 salaries Do I use only the W2 compensation (paid by the S Corps) for retirement plan purposes, or do I have to add in the K-1's that the S corps receive regardless of it being given back to the practice?
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401(k) Plan sponsored by LLC taxed as partnership. When computing (1) the 1/2 Self Employment Tax offset and (2) the resulting "plan compensation" for allocation purposes, are Box 14 code A Self Employment Earnings first reduced by the Box 12 Section 179 Deductions before computing the Self Employment Tax? I do not see this reduction (adjustment to Box 14 SEI) on Schedule SE (Form 1040) in the computation of the self employment tax. Thank you
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If a plan's definition of compensation is simplified 415 and a new owners compensation is K1, does a change in compensation need to be made? If so, which one?
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Here’s an interesting compensation question: Partnership 1 is owned by Company A, Partnership 2 and Person C. Partnership 2 is 100% owned by Person C. Partnership 2 received a K-1 from Partnership 1 Person C receives a K-1 from Partnership 1 Person C receives a K-1 from Partnership 2 Retirement plan is sponsored by Partnership 1 Partnership 2 is not a sponsor of the retirement plan (neither is Company A). The CPA believes that “pension law” dictates that the K-1 pass-through income from Partnership 2 onto IRS form 1040 Schedule E for Person C should be included for Plan Compensation purposes. My gut feeling is that Person C nor Partnership 2 are adopting employers to the plan and only the K-1 from Partnership 1 is Plan Compensation and only their K-1 from Partnership 1 is eligible Plan Compensation subject to the an EIC. If Partnership 2 adopted the plan too, that seems to resolve this question going forward except Person C’s ownership in Partnership 1 would only total 34%. Should the K-1 self employment income from Partnership 2 be included in the eligible plan compensation? Thanks
