Setup a Solo 401k with part-time kids

QUESTION: Mark, I forgot to ask you, if my clients hired their kids part-time does that void the ability of my clients to setup a solo 401k?

Thank you,

Jack I. JD, CFP in California

ANSWER: As long as the kids work less than 1,000 hours per year they will be deemed as working part time and thus do not have to be offered the option to participate in the plan. See IRS publication 560. However, if they are offered the option to participate and do so, the solo 401k will need to be converted to a traditional 401k, which we also offer and many of our clients convert to as their business grows.

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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