K1 with outside W2

[ombskid]

Partner in an llc gets a k1 with 70,000+- in net se income. He has w2 income from other companies that have social security withheld.

Does the social security from the w2's affect the calculation of a maximum profit sharing contribution?

[Larry Starr]

Absolutely.  

[Mike Preston]

Well, it depends on the amount.  Assuming no employee cost and no 179 deductions get in the way, you could have W-2 of anything up to $62,555 without it impacting the calculation.

[ombskid]

So when w2 income is high enough to reduce the se tax amount due - because taxable wages go over the ss wage base - the maximum ps contribution would be increased. Is that accurate?

 

[Mike Preston]

Yes.

[ombskid]

Thank you