If you are a physician with your own practice, chances are you are already, or soon will be, utilizing a qualified retirement plan to defer taxes and save for retirement. As the plan sponsor of retirement plans, such as SEPs, SIMPLE IRA plans, 401(k), profit-sharing plans, and even cash balance plans, you’ll want to be aware of the contribution funding deadlines to ensure your plan stays in compliance so you can focus on caring for your patients and running your practice.
The contribution funding deadlines vary based on the type or source of the contribution, as well as how your business is structured, and the plan is set up.
401(k) employee deferral contributions have been modified for 2025, including an opportunity for an additional catch-up. Employee deferral contributions increased to $23,500. For those ages 50 and over, catch-up contributions of an additional $7,500 can be made. One important change for 2025 is an additional catch-up amount of $3,750 for those ages 60 to 63 before the end of 2025. The table below reflects a catch-up for those ages 60 to 63 of $11,250, which is the sum of the $7,500 plus the $3,750. The maximum 2025 contribution for both employee deferrals and employer contributions year will be $70,000, plus $7,500 in catch-up for those 50 and older and another $3,750 for those who are 60 to 63.
| 2025 | 2024 | |
|---|---|---|
| 401(k) Employee Contribution Limit | $23,500 | $23,000 |
| 401(k) Catch-Up – Age 50+ | $7,500 | $7,500 |
| 401(k) Catch-Up – Age 60 to 63 | $11,250 | ---------- |
| Maximum Defined Contribution Overall Limit | $70,000 | $69,000 |
Data Source: IRS
Employee Plan Contribution Deadlines
The type of contribution with the most scrutiny is the employee deferral contribution. Depositing the contributions withheld from employee wages to the 401(k) plan on a timely basis should be of utmost importance as the IRS and the Department of Labor (DOL) strongly enforce this fiduciary duty.
DOL regulations1 require the deposit of employee contributions and participant loan payments to be made by the earlier of:
- As soon as the amounts withheld from payroll can reasonably be segregated from the company’s general assets, or
- No later than the 15th business day of the following month.
Note that this does not mean a practice can wait weeks after each payroll to make the deposit. The DOL focuses on this “as soon as reasonably possible.” In practice, they’ve been known to enforce a deadline of three to five days after each payroll. But it is the organization’s actual history of deposits that is reviewed. If the organization has shown an ability to make deposits sooner, the DOL will hold the organization to that deposit timing as standard.
The DOL does provide a safe harbor rule for plans with fewer than 100 participants where deposits made up to seven business days after the pay date are considered timely.2
The rule for partners and sole proprietors is different. Since their earned income cannot be determined until after year-end, they have more time to make these deposits. As long as they make a formal contribution election in writing before the end of the plan year, then their deferrals must be deposited by the deadline of the partner’s or sole proprietor’s individual income tax return, with extension. Meeting that deadline ensures these deposit timing requirements are met.
Employer Plan Contribution Deadlines
In addition to employee deferral deadlines, there are also deadlines for depositing employer contributions into your retirement plan. These deadlines must be met to ensure tax deductibility. Contributions may be made each pay period, but employer matching and profit-sharing contributions are required to be deposited by the due date of a practice’s business income tax return (with extension). If this extended tax return deadline is missed, the final deadline for timely deposit is the last day of the plan year following the year of the contribution.
For calendar year filers, below is a summary of the deposit deadlines:
| Employer Tax Status | Deadline | Extended Deadline | Defined Benefit/ Cash Balance Extended Deadline |
|---|---|---|---|
| Partnership | March 15 | September 15 | September 15 |
| S-Corporation | March 15 | September 15 | September 15 |
| Sole Proprietorship | April 15 | October 15 | September 15 |
| C-Corporation | April 15 | October 15 | September 15 |
Data Source: IRS
For defined benefit or cash balance plan contributions, the deposit deadline is also the due date of the practice’s business income tax return. You may extend the contribution deadline by extending the practice’s income tax return. However, the final funding deadline is eight and a half months after the plan year ends (September 15 for calendar year plans). This is the deadline regardless of your tax filing status; sole proprietors and C-corps should pay close attention. The contribution to a defined benefit/cash balance plan is required. Late deposits are those made after these deadlines and will incur a 10% excise tax on the late contribution amount.
By incorporating important deadlines into your practice’s normal procedures, meeting these deadlines can become routine. Additionally, if funding deadlines were missed, there are prescribed corrections. If you have questions about these deadlines or other retirement plan matters, Forvis Mazars has professionals available to assist your practice.