Interested in opening up a self-directed Solo 401k with you, but I have a couple of questions.
QUESTION 1: I have a Rollover IRA at Vanguard. Would I have to liquidate the mutual funds or can I roll them over to the new solo 401k?
ANSWER: You can roll over the Vanguard IRA mutual funds in-kind to your new self-directed Solo 401k. However, if you plan on using some of the Vanguard IRA rollover proceeds for buying real estate, you may want to consider liquidating some of the Vanguard mutual fund positions prior to processing Vanguard IRA direct rollover to your new Solo 401k pan.
QUESTION 2: If I wanted to take a loan from my 401k, will you provide the loan docs, amortization sched., etc. Is that built into the fees?
QUESTION 3: If my main business is fix and flips would I be subject to Solo 401k UBTI if I did deals inside the solo 401k?
ANSWER: It’s our understanding that generally when utilizing Solo 401k non-recourse financing with real estate purchases using Solo 401k funds UBTI does not apply.
QUESTION 4: What is the process for purchasing a property with the solo 401k and tenants in common?
ANSWER: The Tenants-in-common method for purchasing Solo 401k real estate is very similar to purchasing real estate with only Solo 401k funds in that each purchasers separate purchase percentage must be properly reflected on the real estate purchase documents and registration properly reflected.
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QUESTION 5: If I have $60k in my solo 401K and I see a property for 30k and the rehab will cost $25k, I can use 55k of the 60k available in my Solo 401k to fix and flip the property, correct?
ANSWER: Correct, and to be in compliance with the Solo 401k regulations, expenses and earnings in connection with the fixer upper are required to flow through the Solo 401k.
QUESTION 6: If I did need an accountant going forward, would you be able to recommend someone that would be expert in this type of Solo 401k real estate investment strategy after I open Solo 401k?
ANSWER: YES. Actually many of our clients are accountants who specialize in real estate transactions.