christa
Level 1
12-07-2019
02:54 AM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
S corp received income, but did not pay wages to 80/20 married shareholders. They hope the S corp can make discretionary contributions to their respective 401(k) accounts to reduce income passed through to them. My understanding is that discretionary contributions cannot exceed the lesser of 100% of the participant's compensation, or $55K (for 2018). The plan administrator said since it is an LLC, husband and wife owned and (incorrectly) assumes they are 50/50 owners, it can be done as if it is a partnership. Does anyone have experience in dealing with this situation?
Solved! Go to Solution.
Labels