Calculating participant loan
I understand that the loan amount allowed for my Solo 401k is up to 50% of the 401(k) account balance or $50,000 whichever is less. If my Solo 401(k) owns real estate, does the value of the real estate count as part of the account balance, or is it only based on the cash balance […]
Transferring a Fidelity Solo 401k to a Sense Financial Solo 401k
I have a Solo 401k Plan which I originally established at Fidelity. However, I don’t like being limited to only the investment options they offer. How do I transfer it to a new self-directed Solo 401k with checkbook control set up by Sense Financial? Answer: You would first need to have Sense Financial restate your plan documents. Our […]
Are there any options to get Roth funds under my control?
If you have Roth 401k funds, you can roll them over into the Solo 401k Roth sub-account. If you have Roth IRA funds, the only way to get them under your control is to withdraw from the Roth IRA account or to transfer them into self-directed Roth IRA. Please contact us for details.
Spousal Participation
Can my spouse participate in my Solo 401k plan? Answer: A spouse is eligible to participate in your plan if he or she is an employee of the company that adopts the plan. Eligibility for a Solo 401(k) requires that there are no full-time employees in the adopting company other than owners, partners and their […]
What kinds of employees and contractors can my business hire?
What kinds of employees and contractors can my business hire? Answer: If your business has adopted a Solo 401k plan, you can employ part time persons and independent contractors. Part time persons are those who work under 500 hours per year. Independent contractors are workers who receive 1099 compensation rather than W-2 compensation.
What if my wife has employees in her business
Can I set up a 401k for my business where I don’t have employees even if my wife has employees in her business? Answer: No, even if you are on paper don’t own the business of your spouse, in the eyes of the IRS you own it 50/50, therefore neither of you are eligible to […]
How would my new LLC or other business affect my Solo 401k?
If I create an LLC or any other business at a later date that is unrelated to my sole proprietor business, how does that affect my solo 401k? Answer: The LLC or other business should not have any full-time employees, even if the LLC or other business is not the adopting business of the plan. […]
Contributing from multiple businesses
I own three LLCs (LLC #1, LLC #2, and LLC #3). My Solo 401k is adopted by LLC #3. However, LLC #1 generates significant income. Can I make contributions to the Solo 401k from LLC #1? Answer: No. Contributions to your Solo 401k must come from the business that adopted it. If LLC #1 generates most […]
Separate Solo 401k for spouses
Does the IRS prohibits setting up a separate Solo 401k for my wife if she’s billing me as a private consultant? We currently each have our own separate Solo 401ks and she wants to continue that way if at all possible. Answer: The IRS is going to consider both Solo401ks to be one plan, since […]
Rollover Multiple Plans Into Separate Accounts?
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 […]