When the IRS releases an amendment or restatement, your Solo 401k must adopt it to remain compliant.
SECURE amendment
The IRS is releasing an interim amendment ("SECURE amendment") for 2026. You, as plan sponsor, must adopt this amendment by December 31, 2026 in order for your Solo 401k to remain compliant.
The SECURE amendment is a “good faith” amendment which retroactively applies provisions to your plan from the following:
SECURE Act of 2019
Miners Act of 2019
CARES Act of 2020
SECURE 2.0 Act of 2022
Adopting the amendment
As document sponsor, Sense Financial will process the amendment for your plan once it is released by the IRS.
When it's ready, we will email you the SECURE amendment via ZohoSign
Electronically sign the amendment documents
Once signed, a copy will be automatically emailed to you by ZohoSign
Keep this signed amendment in your file
This completes the required adoption of the SECURE amendment
Can I have part-time or full-time employees in my business, if I have a Solo 401k? What if I want to hire employees in the future?
Your Solo 401k is an owner-only plan.
It is designed for the owner of a business who does not have full-time or certain part-time employees, other than the owner and potentially, the spouse.
You are not eligible for the Solo 401k if you/your spouse:
Own business(es) that have full-time employee(s), other than yourselves
Own business(es) that have part-time employee(s), other than yourselves, who work:
At least 500 hours per year, and
For 2 consecutive years
The above criteria does not apply to independent contractors (1099s), if paid by the business. Independent contractors are not considered employees of the business.
If you have any part-time employee(s), please do the following:
Check their hours
Any part-time employee(s) who have worked at least 500 hours for 2 consecutive years become eligible for the plan. And this causes you to become ineligible for the Solo 401k, because the plan is meant for owners only.
If your part-time employee(s) have worked and will remain under 500 hours
You remain eligible for your Solo 401k
Make sure, however, that your plan documents contain the service requirement described below
Check your plan documents
If you have any part-time employee(s), you should have a service requirement checked in your plan documents
Review your Post PPA Defined Contribution Adoption Agreement, page 5
C4.b should be checked as below:
Contact Sense Financial to update the plan if the above service requirement is not marked in your plan documents
Notify Sense Financial Services to update or terminate the plan, if needed
If your part-time employee(s) have worked at least 500 hours for 2 consecutive years, you will need to terminate your plan
Notify Sense Financial to do so immediately
Freezing the plan may be a possible temporary option, before terminating the plan. It allows you to maintain your investments and continue to manage it as the trustee, without the ability to contribute to the plan. It is meant to be a temporary measure only.
Department of Labor (DOL) Regulations 2510.3-3(c) state that Title I of ERISA does not cover plans for partners or a sole proprietor, such as a Solo 401k
While the Solo 401k is not technically covered under Title I of ERISA, the ERISA rules are still considered as a reference because the Solo 401k is a qualified plan.
The IRS requires the following for your Solo 401k:
Interim amendments, which occur periodically
Restatements, which occur every 6 years or so
Required by the IRS
These amendment and restatements are issued by the IRS to reflect changes and updates in the laws which govern qualified plans, including your Solo 401k.
When the IRS releases an amendment or restatement, you are required to adopt them in order for your Solo 401k to remain compliant.
This must be done by the IRS-defined deadline. Restatements, for example, must be adopted within a two-year window after the IRS releases the restatement.
Process for amendments and restatements
The amendment or restatement process is as follows:
When the IRS releases an amendment or restatement, we, as document sponsor, will process the plan documents for you automatically
We will email you the amendment or restatement plan documents, for your electronic signature
You will electronically sign the plan documents
Once signed, a copy will be automatically emailed to you
You must keep the signed documents in your file as plan administrator
By signing and keeping the plan documents, you will have completed the required amendment or restatement for your Solo 401k.
