Fixing incorrect transaction on my 401k debit card
I opened up a bank account with a debit card for the Solo 401k account. I just realized that I gave the debit card number to a wrong vendor who has charged me twice for a personal transaction. How do I fix this? Answer: First, let me remind you to treat your 401k transactions with greater caution. The 401k checkbook/ […]
Contributions from my corporation
Can you please explain how to make contributions to my 401k from my corporation. Can I get paid by the corporation as an independent contractor via 1099 and then claim the state taxes on my personal return or do I need to do the payroll deductions and submit them to the state? Answer: Since your 401k […]
Peer to peer lending using Lending Club
I’d like to check with you if participating as a lender in peer-to-peer lending platform such as Lending Club will be okay in my Solo 401k. They do support opening a Self-directed IRA account, but I would like to be able to invest directly out of my 401k without opening new self-directed IRA account. Answer: Yes, […]
IRS Reminds Plan Sponsors of Plan Restatement Deadline
April 30, 2016, is the deadline for employers using pre-approved retirement plan documents to sign an updated version of their 401(k), profit-sharing or other defined contribution retirement plans. Retirement plan documents must be revised when the law changes. In an updated web page, the Internal Revenue Service (IRS) reminds plan sponsors that document providers who […]
Paying the fee to setup the plan from the plan
Can the fee to set up the plan be counted as a plan expense and be paid for out of the plan? Answer: Generally, expenses incurred in connection with the establishment, termination and design of the plan relate to the employer’s business activities and should not be paid by the plan. See DOL Advisory Opinion 2001-01A. […]
How to choose a business to adopt your 401k plan
If you have more than one business that you own, the following can help you choose which one you use to adopt your 401k plan. The business must have no full time, non-owner W2 employees. In fact, if you have any full time, non-owner employees that receive a W-2 in any businesses that you or your […]
Recharacterization of Roth conversion
Last December, my accountant grossly miscalculated my tax liability estimate, which led me to believe that a Roth conversion could be made with a manageable tax impact. Later, when she prepared my tax returns in April, I discovered that my tax liability was actually much higher, and that the tax impact of the Roth conversion […]
Can I do private lending out of my Solo 401k?
Yes. You can use your 401k as a bank and lend money to other non-disqualified persons. Your Solo 401k would receive principal and interest just like a bank. The account holder (or trustee) chooses the borrower, principal amount, interest rate, length of the term, payment frequency and amount, and whether the note is secured by collateral or […]
Investing in precious metals
Can I purchase precious metals such as silver and gold inside of my Solo 401k plan? Answer: Precious metals such as Gold, Silver, Platinum and Palladium can be purchased inside of a retirement account. If you choose to do so within your Solo 401k, you can enjoy tax-deferred profits going back into your retirement account. Keep […]
Taking property out of a Solo 401k plan as an in-kind distribution
My Solo 401k plan owns a real estate property. I would like to pull this property out after retirement as a distribution. Can I do that and what are the specifics? Answer: You can distribute the real estate property from the Solo 401k plan. This is known as an in-kind distribution. An in-kind distribution is still […]