Using Solo 401k to flip a house
With a Solo 401k, flipping homes or engaging in a real estate transaction is as simple as writing a check. As a trustee of your Solo 401k Trust you have the authority to make real estate investment decisions on behalf of your Solo 401k Trust. However, when engaging in a transaction such as flipping a […]
Titling real estate in the Solo 401k trust
The process to purchase real estate (as well as other assets) with your Solo 401k is fairly simple. There is no special real estate contract needed for retirement account purchases, for example. All assets purchased by the retirement account will be titled in the name of the Solo 401k. Example: ABC Ventures 401k Plan. The […]
Converting property in 401k to Roth
My Solo 401k Trust owns a rental property. If I determine that it is better to pay the taxes on the value in the 401k now, could I convert the property and other cash in the account into a Roth 401k without selling and liquidating the property? Answer: You can convert property and other assets in your 401k […]
Can a sole proprietorship sponsor my retirement plan?
Do I need to incorporate or can I adopt a Solo 401k plan as a sole proprietor? Answer: Any type of business structure can legally adopt the Individual or Solo 401k Plan, including a corporation, LLC, partnership or sole proprietorship. If your new business activity is going to take the form of sole proprietorship, then […]
Spouse as a realtor for 401k investment property purchase
When I buy investment property in my Solo 401k trust, I will engage the services of a realtor. I would like to use my wife. I understand that many spouse transactions are prohibited. But in this case, the seller pays the commissions so I want to confirm if that would be allowed. Answer: No. Your […]
Do I need a business EIN in order to establish my Solo 401k plan?
I’m completing my Solo 401k application, and it asks for a business EIN. I am a sole proprietor and have been using my name and my Social Security number until now to run my business. Do I need to apply for new EIN? And once I have a new EIN, will I have to file […]
What determines the taxation rate applied to profits for financed properties?
A qualified plan (such as the Solo 401k) is exempt from the UBTI related to buying property with financing. For an IRA LLC however, the taxation rate is determined by the amount of leverage you’re using. For example, if eighty percent is leveraged and twenty percent of cash is put into the property, then eighty percent […]
Solo 401k Plan and full time employee other than the plan owner and their spouse
For my Solo 401K plan, if I have more than one employee besides me and my wife, do I have offer them a plan as well? Answer: You and your wife are considered owner-employees of the plan. If you have any other full-time employees (working over 1,000 hours per year), they cannot participate in this […]
What if the Solo 401k sponsoring entity changes or is dissolved?
I currently have a Solo 401K. What if I decide to dissolve the adopting business? Can I change the adopting business of the plan to another one? Answer: Yes. It is possible to amend the plan to reflect the change in the plan sponsor, while keeping the plan information the same. The investments of the plan […]
Can my Solo 401k plan partner with myself?
I now have my Solo 401k Plan and would like to use 401k funds to partner with myself on investment. How can I do that? Can I also partner with someone else’s IRA or 401k? Answer: Your 401k can always partner with other people individually or with other people’s IRAs. Under certain circumstances you personally […]