This thread has been incredibly helpful! I'm also dealing with a solo 401k for my freelance writing business alongside my W2 job. One thing I wanted to add that might help others - make sure you understand the difference between "net earnings from self-employment" and "net profit" from your Schedule C. For solo 401k calculations, you use net earnings from self-employment (which is your Schedule C profit minus half the SE tax), not just the net profit line from Schedule C. I made this mistake my first year and initially calculated my contribution limit too high. Also, if anyone is using tax software, most of the major programs (TurboTax, H&R Block, etc.) will calculate your maximum solo 401k contribution automatically once you enter your self-employment income. But it's still good to understand the math behind it like everyone has explained here. One last tip - if you're close to year-end and trying to decide how much to contribute, remember that you can always contribute less than the maximum, but you can't go over without penalties. When in doubt, be conservative with your calculation!

I actually had to deal with an excess contribution correction a few years ago - it's definitely more hassle than it's worth! I miscalculated my net self-employment earnings and contributed about $800 more than I was allowed. The correction process involved contacting my solo 401k provider, filling out forms to withdraw the excess plus any earnings on that money, and then dealing with the tax implications. The earnings on the excess contribution had to be reported as income for the year I made the contribution, even though I was correcting it the following year. It also delayed my tax filing because I had to wait for the corrected forms from the 401k provider. The whole thing took about 6 weeks to resolve and created extra paperwork headaches. So definitely agree with taking the conservative approach! If you're unsure between two amounts, go with the lower one. You can always contribute more to other retirement accounts if you have extra room in your budget. The IRS is much more forgiving of under-contributing than over-contributing to retirement plans. For the original poster's wife with $19,750 in income, that $3,671 maximum contribution calculation looks solid based on all the discussion here. Just make sure to establish the solo 401k before December 31st if she hasn't already!

I'm currently on unemployment and can add some perspective here. Your 2023 tax refund is completely separate from any unemployment benefits you'll receive in 2024 - they won't interact at all. The IRS processes your tax return based solely on what happened in 2023, so go ahead and file with confidence. However, I want to echo what others have said about tax withholding on unemployment benefits. When you apply, you'll likely see an option to have federal taxes withheld (usually 10%). I strongly recommend choosing this option. Unemployment benefits are fully taxable income, and if you don't have taxes withheld, you could end up owing a significant amount next April. One more tip - if your state has an online unemployment portal, you can usually change your tax withholding election even after you've started receiving benefits. So if you forget to elect it initially, you can still add it later. Better to have slightly smaller weekly payments now than a nasty surprise on your 2024 tax return!

Adding to what everyone has already covered - your 2023 tax refund is completely safe from any unemployment benefits you'll receive in 2024. The IRS processes each tax year independently, so filing for unemployment now won't delay or reduce your current refund at all. One thing I haven't seen mentioned yet is that you should also keep track of any job search expenses while you're unemployed. Things like career counseling, job placement agency fees, resume preparation services, and even travel costs for interviews can potentially be deductible on your 2024 tax return if you end up itemizing deductions. Also, depending on your state, you might be able to receive unemployment benefits even if you're doing some part-time or gig work while job hunting. Each state has different rules about how much you can earn before it affects your weekly benefit amount. Just make sure to report any income honestly when you certify for benefits each week. The tax withholding advice everyone's giving is spot-on - definitely elect to have the 10% federal taxes withheld from your unemployment payments. It might feel like you're getting less money now, but it'll save you from a potentially painful tax bill next year. Good luck with your job search!

Just want to add another perspective on the health insurance piece - we handled this by having our LLC reimburse partners for their actual health insurance costs rather than paying the premiums directly. This way it shows up as a business expense for the LLC and reduces the taxable income allocated to all partners proportionally, rather than creating guaranteed payment income for just the insured partners. At year-end, we adjust distributions to account for these reimbursements so everyone ends up with their intended net amounts. Partners who got health insurance reimbursements receive smaller cash distributions, while others get larger ones. This approach has worked well for us and keeps the tax treatment simpler since there are no 1099s to deal with. Your operating agreement should definitely include flexible distribution language as others mentioned. We use wording that allows distributions "in such amounts and proportions as determined by unanimous consent of the members, which may differ from membership percentage interests." Having this flexibility built in from the start saves you from needing amendments later.

This thread has been incredibly helpful! I'm dealing with a similar situation in my 3-member LLC where we want flexibility for unequal distributions based on varying time contributions and expenses. One thing I haven't seen mentioned yet is how these distribution decisions affect your capital accounts for tax purposes. When you do disproportionate cash distributions, you need to make sure your capital account tracking reflects the actual economic arrangements, not just the cash flow. Our tax preparer explained that if your capital accounts get out of whack with the underlying economics, it could cause issues with loss limitations or if someone exits the partnership later. We ended up having to maintain detailed capital account records that track both the tax allocations (which stay proportional to ownership) and the actual cash distributions. Also want to echo what others said about state law - definitely check your state's requirements. Some states have restrictions on distributions that could impair the LLC's ability to pay debts, so you want to make sure your distribution policy doesn't run afoul of those rules. The operating agreement language is crucial. We added a section that specifically allows distributions to be made "in amounts and at times as may be determined by the members, taking into account the business needs of the Company and the individual circumstances of the members." This gives us flexibility while making it clear that business considerations come first.

Same boat here! Filed 2/3 and Oregon site says deposit on the 15th. Using Varo and they usually drop deposits 2 days early but nothing yet. Really hoping it hits tomorrow or Tuesday 🤞 The waiting game is brutal when you're counting on that money!

I'm still waiting too! Filed on 2/5 with Credit Karma Money and they usually do early deposits but nothing yet. The anticipation is killing me 😅 At least it sounds like some Cash App users are getting theirs early which gives me hope. Maybe tomorrow will be our lucky day!

atleast ur helping ur kids out. had same situation last year, rest came like a month after offset

Been through this exact situation before. The offset process can be confusing but you'll definitely get your remaining $4k. Just keep monitoring your transcript for code 766 (credit to your account) and code 898 (offset). Once the offset processes, you should see the remainder deposit within 2-4 weeks. The wait is annoying but at least you know the money is coming!