Can Unemployed Spouse Transfer Funds to a Solo 401k Plan?

QUESTIONS:

My wife (unemployed) has funds in her teacher pension account from a previous employer.   Can she roll those funds over to the Solo 401k in the trust ?  What are the rules on that ?
 
If not. And if were to simply pull those funds out of her account early and pay the tax, could I contribute those funds into the solo401k or do all monies contributed to the plan need to be generated as income of my business?
 
 

ANSWERS:

1) Even though a solo 401k plan is available to both spouses, she needs to work in the self-employed business (and report self-employment income on her taxes from the business) in order to participate and rollover funds.  Please let us know if this is the case so that we can add her to the plan & guide you through the process.

 
2) Any contributions of non-retirement funds must be justified by self-employment income generated from the business and subject to the contribution limits.

About Mark Nolan

Each day I speak with energetic entrepreneurs looking to take the plunge into a new venture and small business owners eager to take control of their retirement savings. I am passionate about helping others find their financial independence. Having worked for over 20 years with some of the top retirement account custodian and insurance companies I have a deep and extensive knowledge of the complexities of self-directed 401ks and IRAs as well as retirement plan regulations. Learn more about Mark Nolan and My Solo 401k Financial >>

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