Thursday, October 24, 2013

Debit card for Solo401k account




QUESTIONS: Let me know if I can use margin money ( to borrow money from TD Ameritrade , my broker) to buy Stocks, mutual funds, real estate etc. 
I think I may have to file appropriate forms with IRS for UBIT in case of investing in business. What about Stocks, mutual funds?  Are the above rules for Roth Solo 401k also?

ANSWERS: UBIT applies to Roth and pretax funds in a solo 401k when trading on margin.

Yes a debit card may be issued to the 401k (in the name of the 401k). However, a credit card may not be obtained. The debit card is popular for easily paying real estate expenses in connection with the solo 401k owned property. Lastly, the debit card may not be used to pay personal expenses or business expenses.

Thanks Robert in Orlando, FL

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