What are the steps to open a Solo 401k LLC?

Self-directed Solo 401k Question Answered – What are the steps to open a Solo 401k LLC?

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Self-directed Solo 401k FAQ: What are the steps needed to open a solo 401(k) LLC?


Great question!

First, of course a self-employed person must be eligible to open a Solo 401k (i.e.  self-employed with no full-time W-2 employees working for any business owned by you or spouse (if any)).

Such person would then need to open a Solo 401k like our plan that allows for investing in alternative investments such as a real estate, precious metals, crypto, etc.

While many of our clients don’t find that it’s necessary to open an LLC under their Solo 401k as they already have direct checkbook control over the Solo 401k funds, it certainly is acceptable to do so provided that Solo 401k LLC investment rules are followed.

For example, the Solo 401k owner may not invest in an LLC that that the Solo 401k owner already owns (e.g. the LLC through which the self-employed person operates the self-employed business or an LLC through which such person owns real estate personally).

Instead, the Solo 401k would invest in a new LLC where the sole member is the Solo 401k and the Solo 401k owner serves as the manager.

Based on client feedback, some clients will prefer to hold some of their solo 401k assets in an LLC (such as real estate) to provide limited liability protection for other assets (e.g. investment in a Solo 401k brokerage account).

See more here: The Process of Investing a Solo 401k Plan in a Single Member LLC

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About George Blower

I have the privilege of educating our clients about our products and services so that they can make informed and confident decisions about their financial future. Prior to joining My Solo 401k Financial, I served as the general counsel for a subsidiary of a Fortune 500 financial services company. Learn more about George Blower and My Solo 401k Financial >>


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