Solo-k contribution deadline???

[MarketMaker]

If a client has an individual 401k and files for an extension, is the contribution deadline to the 401k also extended?

[Burke]

Don't 401k contributions have to be made by the end of the calendar year?

[MarketMaker]

Normally

Yes, but it seems like the Solo 401k allows contributions up to the tax deadline, including extensions, similar to a sep. I401k contributions are not reported to the IRS.

[Bees Knees]

Elective deferrals must be deposited into the employee's account no later than the 15th business day of the month following the payday. Employer contributions must be made by the return due date, including extensions. Those are the rules for regular 401(k) plans. For a SIMPLE 401(k), the elective deferral must be deposited into the employee's account within 30 days of the last day of the month in which the employee had the contribution withheld from wages. The employer must contribute the matching amounts by the return due date, including extensions.

I don't see any exception in any of the IRS Pubs to the due dates for employee elective deferrals if it is a solo 401(k). The pubs seem to treat SIMPLE IRAs like SEP plans regarding the due date for elective deferrals of a self-employed taxpayer (IRS Pub 560, page 11), but I don't see anything similar for solo 401(k) plans.

[joanmcq]

The employee contribution has to be made by the 15th day of the 1st month, but the loophole is if you include a profit-sharing component in the plan. That contribution doesn't have to be made until the due date of the return including extensions. I have one myself, and always contribute late.

[MarketMaker]

@Joanmcq - so you have until 10/15 with extensions to make the profit sharing contribution?

[joanmcq]

yup. a nice little loophole.

[New York Enrolled Agent]

A couple of posts suggest that the employee deferrals must be made by the 15th day of the next month. Generally, there is no argument on that but this is a single 401K.

I stand to be corrected but I believe there is an ERISA exception that if there are no common law employees (which I think is the case here - it appears to be a sole proprietor) the 15 day rule does not apply. Maybe someone can confirm or deny.

To go back to Burke's question, the plan must be established by 12/31 - the end of the calendar year.