QUESTION: I have a quick question. I’m operating a C Corp small business, but I expect to receive income from multiple sources such as other employers.
Should I consider setting up my Solo 401k as a sole proprietor under
my own name, so that all income sources can be used for plan
ANSWER: As detailed in IRS Publication 560, you can make contributions on behalf of yourself only if you have net earnings (compensation) from self-employment. The solo 401k rules allow for contributions to a solo 401k plan from multiple sources of net self-employment income up to the annual solo 401k contribution limit.
Lastly, the Solo 401k rules prohibit contributions of income earned from your full-time employer unless you are an independent contractor receiving 1099 income, which would afford you option to open a Solo 401k plan.