QUESTION: I’m considering the following real
estate investment opportunity with my father-in-law: we would form a LLC.
Ownership would be 50/50 between my solo
401K and my father-in-law. At some point, my solo 401K would buyout the ownership of my father-in-law.
Would this be a permitted type of business arrangement and use of 401K
funds?
ANSWER:
A father in-law is not a disqualified party with respect to making solo 401k
investments, so the purchase, whether fully or partially, of an asset by
the solo 401k from a non-disqualified person is permissible.
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