Roth Solo 401k Contribution Guide

What type of funds can be contributed to a Solo 401k Roth account?

There are many sources of funds for Self-Directed Solo 401k plans and most – but not all – can be contributed to the Roth Solo 401k subaccount. Following are eligible sources of funds for a 401(k) Roth account: Continue reading “Roth Solo 401k Contribution Guide”

Solo 401K Roth Contribution Q&A

What is a Roth Solo 401k Plan? What is a Solo 401k Plan?

Understanding Roth Solo 401(k)s requires that we first understand the basics of traditional Solo 401k plans. 401K Plans, creatively named after Section 401(K) of the Tax Code, are Defined Contribution qualified retirement plans that allow employees to choose (“elective deferral”) to contribute all or part of their compensation to a tax-advantaged account and exclude the amounts contributed from current taxable income. The tax code calls this a “cash or deferred arrangement,” or CODA. A 401k Plan can be combined with other types of plans, such as Defined Benefit and Cash Balance Plans, to maximize tax deductions and allow for multiple forms of plan contributions. The typical 401(k) Plan provides for  employer profit sharing contributions, in addition to employee contributions. Self-Directed Solo 401(k) Plans are 401(k) plans for businesses that don’t have full-time employees other than business owners and their spouses, which can be designed to include very attractive features such as Roth 401k Contributions and After-Tax Employee Contributions.

What is a Roth Solo 401k Plan?

Continue reading “Solo 401K Roth Contribution Q&A”