Tuesday, November 13, 2012

Transfer Solo 401k to Self-Directed Solo 401k




I currently have a Solo 401k plan for my S-Corp business that only has my wife and I as employees.

I would like to move my 401k to a Self-Directed Solo 401k, but I currently have a Solo 401k loan against it. 

QUESTION 1: Can I transfer my Solo 401k to Self-Directed Solo 401k with the outstanding Solo 401k loan?

ANSWER: The regulations allow the transfer of Solo 401k loan to another 401k such as a Self-Directed Solo 401k. However, before you open self-directed Solo 401k, you will need to check with your current Solo 401k provider as to whether or not they will allow you to transfer the outstanding Solo 401k loan as they are not required to allow for it.

QUESTION 2: We also have a Traditional IRA and a ROTH IRA from a previous employer. Can these be rolled into the solo 401k as well?

ANSWER: The Traditional IRA can be transferred to Solo 401k plan; however, the IRA regulations do not allow for the transfer of Roth IRA to Solo 401k.

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