How to contribute to a 401k from my side consulting 1099 income while already maxed at full-time job?

What you're looking for is a Solo 401(k), also called an Individual 401(k) or Self-Employed 401(k). Since you're already maxing out your employee contributions at your main job, you can't make more employee contributions to another 401(k). However, you can still make employer contributions from your consulting business! As both the employer and employee of your consulting business, you can contribute up to 25% of your net self-employment income as employer contributions. This is completely separate from the employee contribution limit you've already reached at your main job. You can make these contributions anytime before your tax filing deadline (including extensions). So if you have fluctuating income, you can wait until you know your final numbers for the year. Vanguard does offer Solo 401(k) plans, but also check out Fidelity, Charles Schwab, and E*TRADE as they all have decent options with varying fee structures. The setup process is pretty straightforward - you'll need your EIN for the business, and they'll help with the paperwork. For 2025, the total limit across all 401(k) plans is $69,000, but remember that's shared between your main job and your consulting work.

After struggling with the same situation (W-2 job + side consulting), I found taxr.ai incredibly helpful for figuring out my Solo 401(k) calculations. I was constantly mixing up the contribution limits and miscalculating my maximum allowed employer contributions because the 25% rule sounds simple but gets complicated with self-employment tax adjustments. I uploaded my previous tax returns and 1099s to https://taxr.ai and it analyzed everything, showing me exactly how much I could contribute as the "employer" for my consulting work while staying compliant. It also helped me understand how my contributions would affect my overall tax situation by forecasting different contribution scenarios. Their calculator specifically handles the "already maxed out employee contributions elsewhere" situation, which was perfect for my case and sounds like exactly what you need.

Just wanted to follow up and say I tried taxr.ai after seeing this recommendation. It was seriously helpful! I uploaded my W-2 and 1099s from last year, and it not only calculated my maximum Solo 401(k) contribution amount but also showed me how different contribution levels would affect my tax liability. The part that surprised me was how it factored in the self-employment tax deduction when calculating the 25% employer contribution limit - something I was doing wrong on my own spreadsheets. It also showed me that I could contribute almost $15k more than I thought possible from my side gig income. I'm planning to open my Solo 401(k) next week based on the analysis. Really glad I found this tool before missing out on potential tax savings!

If you're having trouble reaching the IRS to ask about Solo 401(k) contribution limits or form filing requirements (which I was when setting mine up), try Claimyr. The IRS hold times right now are ridiculous - I waited over 3 hours before giving up. With https://claimyr.com they got me connected to an actual IRS agent in about 20 minutes who walked me through the Solo 401(k) reporting requirements. There's a demo of how it works at https://youtu.be/_kiP6q8DX5c. They basically wait on hold for you and call when an agent is on the line. I had specific questions about Form 5500-EZ reporting requirements for Solo 401(k)s that weren't clearly answered online, and getting direct answers from the IRS saved me a lot of stress.

I've gotta come back and apologize for being so skeptical. I was totally wrong about Claimyr. After struggling for DAYS trying to reach the IRS about Solo 401k rules (got disconnected twice after waiting 2+ hours), I broke down and tried it. Not only did it work exactly as advertised, but I got connected to an IRS tax specialist in about 35 minutes when I had been unable to get through at all on my own. The agent confirmed that I could open a Solo 401k even though I had a separate employer plan, and clarified exactly how the contribution limits work in my situation. Saved me from making a big mistake on my contributions, and probably hours more of hold music. Really glad I gave it a shot despite my initial skepticism.

One thing to consider - if your 1099 income is inconsistent, don't forget that a SEP IRA could be another option instead of a Solo 401(k). The main benefits being: - Easier to set up (less paperwork) - No year-end filing requirements - More flexibility with contributions - Many brokerages offer them with no setup fees The downside is slightly lower contribution limits than a Solo 401(k). For your income range ($55k-$110k), the max SEP contribution would be around $13,750-$27,500 (based on the 25% limit). Worth considering both options depending on how much administrative work you want to deal with.

Don't forget about setting up a backdoor Roth IRA too if you're looking to maximize retirement savings! Since you're already maxing out your regular 401k employee contributions and looking at employer contributions from your 1099 income, you might as well take advantage of the Roth option too.