Sole Proprietor 401K

[Guest J Samuelson]

Can a sole proprietor who has a 401K plan, make his 401k deferrals after 12/31 but before due date of tax return? For example, for 12/31/99 year end, can the deferral be made to the plan by 4/15/2000? Since we're unsure of exact compensation until the tax return is completed, we don't want to get into ADP issues.

[davef]

If this is a one-person plan, how can there be ADP problems? If there are common law employees, you will need to be concerned about the DOl plan asset regulations on how soon contibution deposits need to be put in trust.

[Guest J Samuelson]

No, it's not a one-person plan. It's actually a two person plan. The other employee is a NHCE and her deferrals are deposited after each payroll. However, the owner's compensation is not determined until his tax return is completed. I'm just wondering when his deferrals have to be deposited to be deductible for 1999.