QUESTION:
I am working on designating the beneficiaries on my self-directed solo 401k.
Our estate attorney suggested that Traditional and ROTH solo 401k’s would best be served by different beneficiary designations. Is it possible to set up different designations for the various self-directed solo 401k funds sources, or are the beneficiaries for all sources of each participant’s account the same, as per the completed beneficiary designation form that is completed?
ANSWER:
Yes, it is possible to name separate beneficiaries for each source of self-directed solo 401k funds. In other words, the beneficiary named for the pretax solo 401k funds can be different than the beneficiary named for your Roth solo 401k funds. You will need to fill out a separate beneficiary form for each source of solo 401k funds (Roth and pretax).
Such designation of separate beneficiaries for each solo 401k fund source is possible because each fund source has to be separately tracked using separate bank or brokerage accounts titled the name of the solo 401k plan.
The Result
Upon your passing (the account holder), the solo 401k benefits will be received based on the separate beneficiary form completed for each solo 401k fund source.
