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The Business of Savings
How to fund your new 2009 401(k) in 2010
There is an important deadline coming up for those starting a solo 401(k) plan (self-employed), as well as for those with employees that are beginning a profit sharing plan. If you are looking to start a 401(k) to save for retirement and lower your 2009 taxes, you will need to setup your 401(k) plan by December 31, 2009. However, you will have until near your tax deadline -- which April 15, 2010 for most -- to fund your plan.
This additional time will allow you to better review your earnings and tax situation so you can determine the right amount to contribute to your plan for 2009. Solo 401(k)s can put up to $49,000 into their 401(k) plan for 2009. For companies with employees, there are multiple ways to profit share with your 401(k) plan and we suggest reading our earlier post to understand the option that best fits your needs.
Our deadline to purchase a 2009 plan is December 21st.