Lion EA Posted March 15, 2022 Report Share Posted March 15, 2022 (edited) May I highjack this to ask about a partnership/MMLLC H/W no employees with a SIMPLE? Edited March 16, 2022 by jklcpa Moved this to its own topic Quote Link to comment Share on other sites More sharing options...
Lion EA Posted March 16, 2022 Author Report Share Posted March 16, 2022 So, does a partner request withholding his SIMPLE contributions from his draws? Or his guaranteed payments? Quote Link to comment Share on other sites More sharing options...
jklcpa Posted March 16, 2022 Report Share Posted March 16, 2022 https://www.irs.gov/retirement-plans/self-employed-individuals-calculating-your-own-retirement-plan-contribution-and-deduction https://www.irs.gov/retirement-plans/retirement-plan-faqs-regarding-contributions-what-is-a-partners-compensation-for-retirement-plan-purposes Draws aren't earnings, and guaranteed payments can't be used in isolation because the partnership could have a loss from operations that could offset some of the guar payts and s.e. income would be less than that. You have to follow the formula that starts with self-employment income and then further adjusts for 1/2 of the s.e. tax and the retirement contributions themselves. (Example - That is similar to using the reduced rate of of 20% for a retirement contribution max of 25% because that difference factors in the owner-employee's share.) 2 1 Quote Link to comment Share on other sites More sharing options...
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