QUESTION:
I have a Roth solo 401k and regular (pretax) solo 401k plan. I’m wondering if I can use the funds in either plan to pay for real estate related expenses, for example conferences. Or if I’m not able to directly pay from them through the plan then is it possible for me to take out a solo 401k loan and I’d use that money to pay for the industry meetings/conferences?
ANSWER:
Unfortunately solo 401k funds cannot be used to pay for conference events. The rule of thumb is to not use the solo 401k funds for educational expenses or travel expenses. For real estate owned by the solo 401k plan, the following expense may be paid using solo 401k funds:
- Property taxes
- Property Insurance
- Repairs on the property performed by third-parties
- Materials for the property
However, yes you can borrow from the solo 401k plan and then use the borrowed proceeds for any purpose including to pay for conferences and travel expenses. When the solo 401k participant borrows from her solo 401k plan, the borrowed funds are no longer considered solo 401k funds.
