Court Case Lerbakken v. Sieloff and Associates Sheds Light On Bankruptcy Protection for Solo 401k Plans and IRAs

Generally, individuals who file for bankruptcy protection may keep all of their qualified retirement plan assets (e.g., solo 4o1k plans)—and up to around $1.3 million in IRA assets. As a result of court case Lerbakken v. Sieloff and Associates, IRA and 401k plan  (including solo 4o1k plans) assets captured through a divorce may not always […]

Effect of 2018 Form 1040 Changes on Solo 401k Plans and IRAs

Tax Cuts and Jobs Act of 2017 resulted in a shift on how information is captured on the 2018 Form 1040 both from  a personal tax and retirement accounts perspective. Here is a breakdown from an IRA and solo 401k angle: Distributions from an IRA will continue to be reported on the main Form 1040, […]

Freeze My Solo 401k Plan

Do I have to keep my business open to keep my solo 401K plan? Yes, generally, it would be permissible to freeze a 401(k) plan, including a solo 401k.  That said, there may be additional issues that would need to be considered, depending upon the specific situation, i.e. the employer has hired employees, the employer […]

The Wall Street Tax Act Plans to Attack 401k Plans Including Solo 401k Plans

While it is a pending bill (i.e., it has not not ye been approved) proposed by democrats in both houses of Congress, the Wall Street Tax Act would indirectly result in an across-the-board fee increase on all 401k plans including solo 401k plans. Here is what the Bill would impose on retirement plans: A financial […]

Removing Excess Deferrals When Contributing to Multiple Retirement Plans

The ERISA consultants at the Retirement Learning Center Resource regularly receive calls from financial advisors on a broad array of technical topics related to IRAs, qualified retirement plans and other types of retirement savings plans. Here is a question that was posed to an ERISA consultant at the Retirement Learning Center. “What is a plan participant’s […]

Making Voluntary After-Tax Contributions to Combined Hybrid 401k and Defined Benefit Plan | DB(k) Plan

In the following post, we explain how voluntary after-tax contributions made to a Solo 401k plan does not limit the ability to fully fund a defined benefit plan. Question from Carolyn from Scottsdale, Arizona My income is W-2 from my own PLLC, about $230k.  My CPA calculated my solo 401k contributions up to (i) $18500 as […]

Consider Using Roth IRA for College Savings

With college tuition increasing each year, utilizing a Roth IRA to cover some of those college costs may be be a good idea. Also, Roth IRA contributions will not affect the amount of financial aid your student receives because Roth IRA contributions are not tax deductible. Roth IRA Distributions Roth IRA contributions can be distributed […]

Highlights of Pending The Retirement Security and Savings Act of 2018

Jointly sponsored by Senators Rob Portman (R-OH) and Ben Cardin (D-MD), the Retirement Security and Savings Act of 2018  is considered as sweeping as prior bills (Economic Growth and Tax Relief Reconciliation Act of 2001 and the Pension Protection Act of 2006). It will be interesting to see which parts of the bill if any […]

Program Letter Published on October 3, 2018 by the Commissioners of IRS’s Tax Exempt & Government Entities Division

When making a distribution from a 401k plan including a solo 401k plan it is important to make sure you qualify to take a distribution as triggering events apply. Types of Solo 401k Contributions and Distribution Rules      After-Tax Contributions and Rollover Contributions. The solo 401k plan participant may withdraw at any time (after completing a distribution […]

IRS Advisory Council releases its 2018 annual report

The full 2018 IRSAC Public Report is available on WASHINGTON — The Internal Revenue Service Advisory Council (IRSAC) today issued its annual report for 2018, including recommendations to the IRS on new and continuing issues in tax administration. The IRSAC is a federal advisory committee that provides an organized public forum for discussion of relevant tax […]

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