This year I worked as an independent contractor with several delivery companies (Doordash, Amazon Flex, etc). My total earnings for this year will be around $86000. I estimate my expenses as $33000 (mostly mileage). I would like to calculate how much I can contribute to retirement accounts this year. Could you check my math, please?
Schedule C profit: 86000 - 33000 = 53000
Self-Employment taxes = Schedule C profit * 0.9235 * 0.153 = 53000 * 0.9235 * 0.153 = 7489
1/2 of SE Tax = 3744
Self-Employment Income = 53000 - 3744 = 49256
An employee contribution of $19500 for 2020.
An employer contribution of 20% of Self-Employment Income = 9851.
So, it seems like I can contribute:
- $19500 to Roth Solo 401k,
- $9851 to Individual Solo 401k,
- $6000 to Roth IRA.
Is it correct?
About deadlines. I have to open Roth and Individual Solo 401k before 31 December, right? But I can contribute to all retirement accounts next year until April 15.
Am I miss something?
Submitted December 21, 2020 at 06:35PM by volunteerist https://ift.tt/3axDY3J
