tax deferred account options

[skiMD]

My main source of income currently is from a employed physician group which pays through W2s. I do some consulting work on the side that is reported through 1099 misc forms. I'm currently contributing 18k a year to a work 403b with a company match. Am I still able to put any 1099 income into a tax deferred account like a solo 401k? If not, what would my options be?

[consultpsych]

yes!

The employee contributions to your 403b and solo-401k must be <= $18k.

If you get a match, contribute at least enough to get the full match offered, to the 403b. The rest up to 18k can be in either the 403b or 401k.

But additionally, you can make employer contributions to the 401k. That ends up being 20% of your net earned income from the 1099.

There is a total limit to the 401k (I think it's 53,000 if you're under 50) as well.

[Zaphod]

There is no total limit for 401ks (aside from the employee contribution), just number of jobs and earnings.

[jfoxcpacfp]

consultpsych wrote:

yes!

The employee contributions to your 403b and solo-401k must be <= $18k.

If you get a match, contribute at least enough to get the full match offered, to the 403b. The rest up to 18k can be in either the 403b or 401k.

But additionally, you can make employer contributions to the 401k. That ends up being 20% of your net earned income from the 1099.

There is a total limit to the 401k (I think it’s 53,000 if you’re under 50) as well.

Click to expand...

Zaphod wrote:

There is no total limit for 401ks (aside from the employee contribution), just number of jobs and earnings.

Click to expand...

To combine these 2 answers - if you are under age 50, you can have a total of $53k contributed to each non-related employer 401k/403b ($59k if age 50+). The employee (you) can have no more than $18k total in discretionary contributions across all accounts.

[Slav4ikMD]

I think that in your situation it may be best to have a sepIRA?  I think that if you have a 403b, you can't contribute as an employee to a solo401k (to exceed 18k), as stated above.  Personally my employer offer a 457 plan, and with that I CAN have a solo401k for self-employed income, which is great.

[jfoxcpacfp]

Slav4ikMD wrote:

I think that in your situation it may be best to have a sepIRA?  I think that if you have a 403b, you can’t contribute as an employee to a solo401k (to exceed 18k), as stated above.  Personally my employer offer a 457 plan, and with that I CAN have a solo401k for self-employed income, which is great.

Click to expand...

You can contribute to a SOLO-k with a 403b, same as with a 401k. You are limited to 20% of earned income with a SEP, same as with the SOLO-k and you will then pay taxes on future back-door Roth contributions.