First and foremost, the Solo 401(k) is an employer sponsored retirement plan for self-employed person(s) with no W-2 employees. Most commonly this applies to small business owners, but almost anyone who pays taxes with an EIN separate from their SSN could qualify. Company owner’s spouses are permitted to participate in the plan if working for the company. One attractive feature is the high contribution levels (50k+) compared to your standard IRA contribution (6k). Contributions are made from both ‘employee’ and ‘employer,’ and can be placed within either pre-tax or post-tax (Traditional or Roth) sub accounts within your Solo(k). Participants can also take loans from the plan, and all traditional retirement accounts can be transferred into your new Solo-K account.
A Solo(k) LLC is a structure within your retirement account that your qualified funds can invest in. Your newly formed Solo(k) can invest into alternative investments--such as an LLC. By investing into the LLC, you are establishing a company that can make investment decisions on behalf of the Solo(k) account. Funds from your current retirement accounts are consolidated into a Solo(k), then invested into a newly created LLC business checking account, for you to make time-sensitive investments.
A Solo 401(k) LLC gives you the opportunity to purchase real estate and other investments with your IRA, Individual 401(k) Plan or other retirement account. The Solo 401(k) LLC provides an investment vehicle where you can manage your retirement investments with the same flexibility and control you use when managing your non-retirement investments.
The greatest benefit of the Solo 401(k) LLC is that it gives the account owner total control — there is no participation in the investments by a self-directed IRA custodian, meaning a custodian does not have to process paperwork, complete transactions, notarize documents or interact with your investments. Full freedom and control, without endless fees, the Solo 401(K) is what you’ve been looking for. Call us for a free consultation and we’ll set up your account, complete all the necessary documentation, and provide expert guidance on how to make the most of your investment.
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