401k contribs/ possible Biden changes

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raven33
Posts: 4
Joined: Thu Dec 10, 2020 4:59 pm

401k contribs/ possible Biden changes

Post by raven33 »

Hi,

I'm attempting to max out solo 401k contributions from my self-employment job.
I'm in the 12% tax bracket. I like to contribute as early in the year as possible, to take advantage of potential gains.

I usually make entirely Roth contributions (because taxes are low and any deduction for pre-tax 401k contributions is really an 80% deduction because it's offset by the Qualified Business Income credit).

BUT I'm reading that Biden may make it more advantageous to make non-Roth contributions to a 401k, for people in the lowest 2 tax brackets.

Is it worth waiting until later in the year to make my 401k contributions and decide whether they'll be Roth or non-Roth?
Or would his tax proposal not affect 2021 contributions?

Thank you!
Hyperchicken
Posts: 2006
Joined: Mon Mar 02, 2020 4:33 pm

Re: 401k contribs/ possible Biden changes

Post by Hyperchicken »

Whatever you decide, watch out for lost match if you only start contributing later in the year.
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oldcomputerguy
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Re: 401k contribs/ possible Biden changes

Post by oldcomputerguy »

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