Finally opened Solo 401k bank account at Bank of America

BACKGROUND: I was able to open the account for myself as a trustee with Bank of America (it wasn’t easy though). I had to go to multiple branches as the bank reps kept referring me to their Merrill Lynch division to open one of their solo 401k plans, which is obviously not what I wanted. My wife will also be opening her solo 401k bank account as a trustee this weekend.

QUESTION: Since now the account is setup, for employer contribution – can I just transfer the funds to this account online – or should I cut a check payable to the solo 401k from my business account?

QUESTION: For an employee contribution, I will try to setup via the payroll service. In case I have issues with that, then should I make employee contribution from my personal account?

ANSWER: You can either make contributions by check or wire. The key is that they are generated from earned income stemming from the self-employed business sponsoring the solo 401k plan. Please use solo 401k contribution form located on the forms section of our website. Note that this form is for your records only.


http://www.mysolo401k.net/Free-Solo-401k-Investment-Forms.html

Reviews for www.mysolo401k.net | Title Solo 401k Bank Account

Before filing my formal application with you I’d like your preliminary take
on the following:

-Funds will be transferred from current bank account styled “Joe S
IRA”

-Current sole proprietorship files annually with IRS under my name and SSN.

-EIN (planned but not yet applied for) in name of “XYZ Solo 401k
Trust”.

-Planned DBA (not yet filed)  “XYZ 401k Trust DBA JS SOLO
TRUST”,  with checkbook designation:  “JSSOLO TRUST “. This is for
checkbook account styling, not IRS filing.

CORRECTION: The checking account would read as follows: XYZ Solo 401k Trus FBO Joe S

 Please advise recommended revision of any of above before I fill in my
application with you.

Additional question:

What is involved in funds transfer (on different dates) from same existing
IRA bank account noted above to identically styled accounts Solo 401k
accounts at two different banks? Additional fees on your part? I do not
anticipate more than four total transfers.

ANSWER: We do not charge any additional fees for preparing IRA transfer forms. With regard to moving funds from an IRA to a solo 401k, I recommend always processing it as a direct rollover instead of a 60 day rollover. Reason being, unlike a rollover where only one can be processed in a 12 month period from the respective IRA, one can process unlimited number of direct rollovers in a 12 month period. Again, we will prepare the IRA direct rollover form(s) once you sign up for our services.

The references you provided were very positive about your services, and they all gave great reviews regarding www.mysolo401k.net

Thanks,

Joe P in Maryland

Contribute to a 457(b) governmental plan and solo 401k at the same time

QUESTION: Can I contribute to a 457(b) governmental plan and solo 401k at the same time?

ANSWER:  For those who are actively contributing to a 457b,  are also self employed and have opened a solo 401k, the annual contribution rules allow for contributions to both a 457b and a solo 401k. Therefore, you can maximize the contributions to each plan. For example, the maximum salary deferral contribution (also known as employee contribution) that may be made to a 457b in 2013 is $17,500, which is the same for a solo 401k plan. Therefore, if you have the income from both your full-time job and your self -employed business sponsoring the solo 401k to support the contributions, you could theoretically contribute $51,000 to the solo 401k plan (made up of profit sharing and employee contributions) and an additional $17,500 to the 457b plan for tax year 2013.

Thnx,

Nancy in FL

Convert Solo 401k to a full-time employer 401k

QUESTION 1: If I bring on other people as owners of my company, will they be able to use the Solo 401K that my company is sponsoring?

ANSWER: Only a maximum of two business partners may adopt a solo 401k. Therefore, once your business exceeds the 2 person limit, the solo 401k will need to be converted to a traditional 401k (a 401k for a business with more than two business partners/employees). We offer traditional 401k plans in addition to solo 401k plans, so once your business reaches this milestone let us know and we will convert your solo 401k plan to a traditional 401k in a matter of a few days.

QUESTION 2: Will I be able to take the Credit for Small Employer Pension Plan Startup Costs (form 8881)?

ASNSWER: Visit following blog from our website to learn about the plan startup credit and Form 8881.

http://www.mysolo401k.net/blog-for-mysolo401k.html?entry=plan-start-up-tax-credit

Thanks!

John