Announcement

Collapse
No announcement yet.

Company 401k for only half the year - am I eligible for individual 401k?

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

  • Company 401k for only half the year - am I eligible for individual 401k?

    A question came up from one of my senior co-residents who is entertaining job offers. He is currently a resident and our hospital offers a regular 401k as a W2 employee. He will graduate in June and take a position as an attending, but in the contract he mentioned that he won't have access to the 401k until he has been with the new practice at least 6 months (which will be 2018 then). We were discussing how much he is able to contribute and what the best strategy is?

    -Can he max out his 18k portion for the first six months while still a resident (if he has the money to do so) and then setup a solo 401k for the rest of 2017 and contribute to that while an attending? Or does the fact that he did have some access to a regular 401k during the 2017 calendar year make him ineligible for a solo 401k?

  • #2


    -Can he max out his 18k portion for the first six months while still a resident (if he has the money to do so) and then setup a solo 401k for the rest of 2017 and contribute to that while an attending? Or does the fact that he did have some access to a regular 401k during the 2017 calendar year make him ineligible for a solo 401k?
    Click to expand...



    1. Yes, he can max out $18k in the 1st job.

    2. Yes, he can also set up and contribute to a SOLO-k in 2017, but only if he has some IC income. Will he be moonlighting along with his W2 attending job?

    Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

    Comment


    • #3
      No moonlighting. Just working at his regular attending job upon graduation.

      1c income?

      Comment


      • #4
        IC = Independent Contractor

        Comment


        • #5
          In case the OP is not aware of it. There is only one employee elective deferral limit (2017 = $18K) between all qualified plans of all employers. If the full $18K is deferred at the first employer, there is no deferral available at subsequent employer.

          As already stated, it is only possible to open and contribute to a solo 401k if there is self-employment or S-Corp 2% shareholder-employee compensation. If the circumstances of the first paragraph exist, only employer contributions would be possible. If self-employment, you can only contribute a maximum of 20% of net self-employment income. If shareholder-employee (W-2), you can only contribute a maximum of 25% of W-2 compensation.

          Comment

          Working...
          X