W2 and K1 in a controlled group

Woman owns half of an  S-Corp with husband.  Each takes $40,000 W2 income, defers $15,000.

Also owns partnership w/ husband (50-50).  Both have losses of ($150,000).  Each.

Because there is a controlled group, can they make the 401(k) deferral b/c it came from W2 wages?

Or are they out of luck, because the combined income is negative?

No negative numbers!

Not sure what you mean there?

Am I not allowed to use negative numbers in my question?

Or no deferral b/c of the negative numbers?

For plan purposes, the partnership income is considered as zero. You do not net the compensation from one entity with a self-employment loss at another entity. 

So, if I have:

Company A: 30,000 W2 Comp

Company B: (10,000) loss

Company C : $50,000 net self-employment

I use 80,000 as comp.