Tuesday, December 25, 2012

Can I transfer an Annuity to a Solo 401k?




QUESTION: I have an ING Express variable Annuity - which is not part of any IRA of any kind - just a regular annuity. How can this be transferred to my new self-directed Solo 401k?

ANSWER: The Solo 401k plan rules must be followed when transferring retirement funds to it.  Therefore, unless the annuity that you are seeking to transfer to your new Solo 401k is held inside a 401k, 403(b), 457, 401k, or SEP, SIMPLE or Traditional IRA, you will not be able to transfer your annuity to your new Solo 401k. Note that when an annuity is not held inside an IRA or qualified plan it is generally referred to  as non-qualified annuity, a type of annuity that is funded with after tax funds and cannot be transferred to a Solo 401k plan.

However, if the annuity is held inside an IRA or qualified plan, it may be transferred to your Solo 401k by either completing the annuity company’s transfer-out forms or using a Solo 401k providers transfer forms.

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