Home Fairmark Forum Retirement Savings and Benefits SOLO 401K CONTRIBUTION

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  • #7569

    The deadline to make a 2019contribution is 10/15 assuming taxpayer has an extension. Suppose taxpayer filed timely and does not have an extension. Is it still acceptable to make a contribution after the due date of the return? I know the obvious answer, but I remember reading something somewhere that made the case for a late contribution without the extension with the rationale that unless the taxpayer was permitted to so, he/she would effectively be penalized for filing a timely tax return.
    Am I crazy?

    Alan S.

    Not crazy. The deadline for the employer contribution is the tax due date for the business entity (not necessarily 4/15). To be eligible to make these contributions after the due date, the taxpayer must have filed an extension, and an extension cannot be filed after the return has been filed. Therefore, if the return is filed on time (or late without an extension), the taxpayer is not allowed to make a contribution after the initial due date. Finally, since the tax due can vary for certain non sole proprietor business entities, a 6 month extension could end prior to 10/15 (9/15 if the business entity had a due date of 3/15). This also applies to a SEP IRA contribution where all contributions are employer contributions.

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