Running a business owned by my 401k
Can I use my Solo 401k plan to acquire a business? Can I run it myself? Answer: This is a two part question so I will provide a two part answer. First, all retirement plans, according to the IRS rules, are to be invested passively. When you use your 401k to invest in an active business, […]
Can I receive income personally from my Solo 401k investment?
Can I receive income personally from my Solo 401k investment? Answer: No. This violates the prohibited transaction rules. The main purpose of these prohibited transaction rules is to prevent you from benefiting from your Solo 401(k) without paying taxes. 401k plans have special tax benefits that allow us to save and invest money for retirement. […]
Personal involvement with 401k investments
How much can I be personally involved with my Solo 401k investments? Can I manage properties owned by my 401k? What can I do and not do when it comes to managing the properties? You are a disqualified person with respect to the investments of the 401k, so you want to be careful as to […]
Is the 401k Trust revocable or irrevocable?
Is the 401k Trust revocable or irrevocable? Answer: Revocable and irrevocable trust are terms that are usually applied to a personal trust – one that an individual would set up for estate planning purposes. Those terms are not applied to a qualified plan’s trust, such as the one that is established for a 401(k) plan […]
Sense Financial as document sponsor
Sense Financial Services is a document sponsor for your Solo 401k. We have a prototype document for the 401k that is approved by the IRS The IRS Opinion letter states that our prototype document meets the IRS guidelines for a qualified 401k plan and thus establishes a qualified 401k plan We create plan documents for […]
Rolling over funds from a 401k with an outstanding loan
Can I rollover funds from a 401k with an outstanding loan? Please check with your current 401k plan administrator: Whether your current plan allows for in-service distributions If not, your plan will not allow you to transfer any cash or assets out of the plan unless the plan or your employment with the company is […]
Late payment on a participant loan
What if I am late with a repayment to my Solo 401k participant loan? Are there penalties for late payment on a participant loan? Your Solo 401k allows for a cure period, which allows you to make a missed payment up until the last day of the calendar quarter after the calendar quarter in which […]
Financing for asset purchase in Solo 401k
If I am investing in real estate with my Solo 401k, but don’t have enough funds in my Solo 401k, what are my options? Funds can be added to your plan via: Rolling over additional funds from another retirement account Contributing to the plan from your compensation from the adopting business Or, financing can be […]
Distributions from the Solo 401k
Can I take a distribution from my Solo 401k? Will I owe taxes? At what age can I distribute from my Solo 401k without penalty? Distributing funds out of the Solo 401k is called an “in-service distribution” when the Solo 401k plan and its adopting business are still active. Determine your eligibility to take the distribution […]
Living trust as primary beneficiary
Is there a way to make my living trust the primary beneficiary of my Solo 401k? Yes. On the beneficiary designation form, you can name your living trust as the primary beneficiary.