Questions about Rollovers to a 401k and Loans

QUESTION 1: Is it possible to rollover a defined benefit plan balance from a former employer into a new solo 401(k) for an entrepreneur’s business?

ANSWER: Yes the rules allow for the transfer of a defined benefit plan (DBP) to a 401k including a solo 401k.

The solo 401k CANNOT be invested in one’s own business; however, it may be invested passively in another individuals company.

If you are looking to invest your DB and/or other retirement funds into your own business, then the ROBS 401k may be the only option.

QUESTION 2: After the rollover, is it possible to take mortgage loans or regular loans from the Solo 401(k)?

ANSWER: Yes the solo 401k and the ROBS 401k allow for 401k participant loans as well as investing in mortgage loans.

Jeff, CPA, CFP in Iowa

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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