senior moment

[thepensionmaven]

2 employees are W-2 wages.

Each contribute $15,500 to their company's 401(k) plan.

Accountant urges them to form a partnership with one other individual. No control issues, no affiliated service issues.

Assuming they have the income, I do not believe they can contribute the full $53,000 each to the partnership plan as long as each has made the $17,500 contribution in the same year.

Doesn't the $53,000 maximum contribution include the individual's 401(k) contribution regardless of the employer?

Accountant says they can contribute the full $53,000 to partnership plan.

I could be wrong, but I do not believe so.

[Bill Presson]

If there is no controlled group, then each person can receive $53,000 to multiple plans. The deferral limit of $17,500 ($18k this year) is an individual limit and that can't be duplicated in multiple plans.

So, if I worked for Ford, GM and Chrysler and made enough money in all three, I could get three different contributions of $53k in each plan.