Solo 401k Loan Interest Rate Increase Prime Rate Plus One

The cost of borrowing form your solo 401k plan just increased from 4.50% to 4.75%. In several communications, the IRS has consistently stated that a fair interest rate payment on a 401k participant loan is the prime rate plus one point.  The new prime rate of 3.75% went into effect this week.  It was previously at 3.50%.

The new prime rate of 3.75% only affects new 401k participant loans not prior loans because when you borrow from a solo 401k plan, the interest rate stays fixed during the life of the solo 401k participant loan. Therefore, any new solo 401k participant loans would be subject to the 4.75% (3.75 plus on point) interest payment. Of course, the full loan interest payment flows back to the solo 401k  plan not the bank or brokerage firm. To learn more about he solo 401k participant loan rules, VISIT HERE.

Tags: , , , , ,

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 >>

  •  

  • Popular Video

  • ROBS 401k Funding Process

  • Solo 401k Contributions Including Mega

  • Checkbook IRA LLC

  • About MySolo401k

    We help our clients take control of their retirement money. Our products and services provide our clients the freedom to invest their retirement savings in their own business as well as alternative investments such as real estate, private companies, promissory notes, precious metals, tax liens and equities.
    Learn more

    Connect with us

  • We’re here to help.

    Call: 800-489-7571

    Monday-Friday

    8:00 am - 4:00 pm PT

    Why us?
MENU