Q 1. Is it OK to use a Debit card with the solo 401K?
ANSWER: While a debit
card is allowed and a credit card is not, Fidelity does not offer a debit card
for a solo 401k, but Wells Fargo
does.
Q 2. I am planning to buy a rental property with the
traditional SOLO 401K and would like to roll it over to the Roth 401K in the future. Can
I transfer half on December 31 and the other half on January 1 so that I spread
the rollover taxes over 2 years?
ANSWER: Yes you can process partial in-plan
roth solo 401k conversions, but they must be formally documented using an
in-plan roth 401k conversion form. Also, the property being converted must be
appraised prior to the conversion so the correct solo 401k conversion amount is
reported on Form 1099R.
How does
the Solo 401k Owner/Participant Report the in-plan Roth conversion on his or
her personal tax return?
If tax payer files Form 1040, report Roth Solo 401k conversion amount on line 16a and 16b.
If tax payer files Form 1040A, report Roth Solo 401k conversion amount on line 12a and 12b.
If tax payer files Form 1040RN, report Roth Solo 401k conversion amount on line 17a and 17b.
If tax payer files Form 1040, report Roth Solo 401k conversion amount on line 16a and 16b.
If tax payer files Form 1040A, report Roth Solo 401k conversion amount on line 12a and 12b.
If tax payer files Form 1040RN, report Roth Solo 401k conversion amount on line 17a and 17b.
ADDITIONAL RESOURCES
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