Transfers and Rollovers

I have an IRA Fidelity which is invested in the money market and a 401k  withh ADP from the previous employer.  I'd like to rollover those funds into my new Solo 401k. Does the money from IRA have to be kept separate from the funds from the 401k?

Answer: 

No, all of the rollover funds may be rolled into the same bank account.  You will, however, need to setup separate accounts for each type of money, for example: rollovers, employer profit-sharing contributions, elective deferrals and Roth deferrals.

Is there a limit to how much money I can transfer from my IRA’s into my Solo 401k?

Answer: No.

How do I document a rollover or transfer to my Solo 401k?

Answer:

Documenting a transfer from your existing retirement accounts to your Solo 401k when filing your taxes is pretty simple. The exact lines used to enter your transfer amounts will vary depending on what type of account the transfer originated from as well as what form you are using to file your taxes.

Below you will find instructions on exactly what lines to use depending on whether you’re filing FORM 1040 or FORM 1040A (you cannot use FORM 1040EZ if you have retirement account rollovers/transfers to report) and whether the transfer came from an IRA or a 401k or other qualified plan. Be sure to look at the instructions for your situation.

If filing FORM 1040 (not FORM 1040A):

For transfers from an IRA to your Solo 401k:

• Enter the total amount of the IRA funds transferred to your Solo 401k on line 15a of your 1040.
• Enter the taxable amount of the transfer, “0”, on line 15b of your 1040. Enter “Rollover” next to line 15b of your 1040.

For transfers from a 401k or other qualified plan to your Solo 401k:

• Enter the total amount of the 401k (or other qualified plan such as 403b and 457b plan) funds transferred to your Solo 401k on line 16a of your 1040.
• Enter the taxable amount of the transfer, “0”, on line 16b of your 1040. Enter “Rollover” next to line 16b of your 1040.

If filing FORM 1040A (not FORM 1040):

For transfers from an IRA to your Solo 401k:

• Enter the total amount of the IRA funds transferred to your Solo 401k on line 11a of your 1040A.
• Enter the taxable amount of the transfer, “0”, on line 11b of your 1040A. Enter “Rollover” next to line 11b of your 1040A.

For transfers from a 401k or other qualified plan to your Solo 401k:

• Enter the total amount of the 401k (or other qualified plan such as 403b and 457b plan) funds transferred to your Solo 401k on line 12a of your 1040A.
• Enter the taxable amount of the transfer, “0”, on line 12b of your 1040A. Enter “Rollover” next to line 12b of your 1040A.

Entering this information on your 1040 or 1040A will show the movement of the funds and that the transfers are not taxable.

Can money from my Thrift Savings Plan (TSP) be rolled over into a Solo 401k?

Answer: Yes.

If I want to put in more money later can I do that? I want to transfer some more money later from somewhere else?

Answer:

The Solo 401k does not have a time limit for transfers or rollovers within a certain time period. Likewise, the Solo 401k does not have a limit of the number of transfers.

Can I rollover my Roth IRA into a Roth component of my Solo 401k?

Answer:

It is generally understood that everything can be rolled over from one type of account to another type of account freely, with the one exception of a ROTH IRA.  ROTH IRA funds can only be rolled into another ROTH IRA.  If you need to roll over a ROTH IRA, it will have to be into another ROTH IRA.

While the Solo 401k has a ROTH component to it, the IRS does not allow funds from a ROTH IRA to be rolled over into the ROTH Solo 401k.  The ROTH component allows you to make contributions to that ROTH component, rollover funds from another ROTH 401k, or convert your pre-tax portion of the Solo 401k into ROTH.

Can I rollover an existing Roth with another investment to a self-directed Solo 401k?

Answer:

If you’re talking about Roth IRA assets, the answer is no.

Roth IRA assets can only go from a Roth IRA account to a Roth IRA account.

If you’re talking about Roth 401k account assets from another Roth 401k, that’s what’s called a designated Roth account inside of a 401k. Designated Roth account assets inside of 401ks can be moved to another designated Roth account inside of another 401k which you have that ability with your Solo 401k.

Can a tax deferred annuity be rolled over into a Solo 401k?

Answer: 

Although annuity is a tax-deferred vehicle, it is NOT considered a Qualified Retirement Account.  However, if the annuity is held within a retirement plan it can be rolled over.