My client is a 1099 consultant for his previous company and he asked me if he should take out money for his retirement account before he deposits his checks in his Business Bank account or after. My initial thoughts were to tell him it didn't matter but then I wasn't so sure that's true.
USA Self Employed Retirement Contributions
- Thread starter mikeruney
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In my opinion, I really do not think that it will make much of a difference. Here is why I have come to that conclusion. Because he is a 1099 employee, there are no taxes or deductions taken out of his income by the people he earned it from. If he had been an employee of the company and was enrolled in a 401K or other retirement income deduction plan, this would reduce his take home income by putting money in that plan before he actually received it. This would have also helped to reduce his taxable income. So he can just place money into an retirement account after he gets it. If he chooses an IRA, he will have to choose whether it will be a traditional IRA or a Roth IRA.
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Hello, I'm new to this thread. I apologize in advance if this is a wrong post for this thread. A family member recently past away, he had a solo 401k plan/profit sharing. We recently learnt that there was a life insurance and the beneficiary is the plan. I am told it has to go to the plan first before going to the beneficiary. But the question is how is this life insurance benefit coded (i.e. Contribution, rollover...i see no options for life insurance) that has to go into the 401k plan? Anybody seen this before? Thanks in advance.