Before you a open Solo 401k, keep in mind that a solo 401k is only avialable to owner-only businesses. For example, if the solo 401k is sponsored by a parternship that is made up of four partners, all four partners can participate in the same solo 401k plan because the solo 401k is sponsored by the partnership and all four owners are partners in the same partnership.
Furthermore, to participate in Solo 401k you have to be generating self-employment income. The self-employment income requirement applies separately to each participant. In other words, if spouse or business partner 1 generates self-employment income, he or she can open a solo 401k and thereby participate in solo 401k, but if spouse or business partner 2 does not generate self-employment income from the same business, he or she can not participate in same solo 401k.
Two Separate Checking Accounts (one for each Solo 401k participant)
In the case of a solo 401k plan where the onwers of the business are solefy a husband and wife, both individuals qualify to participate in the same solo 401k, so separate sub accounts/checking accounts are required for each Solo 401k participant to separately account for each participants contributions, rollovers/transfers and investment gains. For example, let’s say Participant A and Participant B qualify for Solo 401k since they are both employed under the same self-employed company and both want to contribute to a Solo 401k. Therefore, two checking accounts would be required (one for each participant).
Let’sassume name of Solo 401k plan is XYZ Solo 401k Trust.
Based on this, the title for each Solo 401k checking account would read as follows:
Checking account 1 for Participant A: XYZ Solo 401k Trust, John Doe, Trustee
Checking account 2 for Participant B: XYZ Solo 401k Trust, Mary Doe, Trustee