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Posted

Sole proprietor has net income of $25,000 and maintains a solo 401(k) Plan (please ignore the self-employment tax issues here)

Want to maximize the amount put into the Solok.

Is the amount that can be contributed for 2019 $25,000 (sole proprietor is over 50), or $30,000 ($25,000 deferral plus 20% of net income of $5,000)?

Reading the IRS publication on this does not provide a definitive answer.

Thanks for any replies.

Posted

Being a Solok the plan document might be more restrictive, so you should check that.   But in a normal plan the maximum would be the deferral plus .25/1.25 x $25,000 of $5,000.

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