I am looking to transfer my IRA into a self directed solo 401k and have a couple of questions   QUESTION 1: How much is the cost to set this up?

ANSWER: The setup of a self-directed Solo 401k charged by solo 401k providers ranges from $395.00 up to $2,500. While the solo 401k plan documents offered by solo 401k providers including self-directed solo 401k providers are approved by the IRS through the issuance of an IRS opinion letter, the market obviously supports the high solo 401k setup fees.

QUESTION 2: Ongoing/ annual fees for maintenance?

ANSWER: Most self-directed solo 401k providers annual fee ranges from $125.00 to $195.00; however, some charge $40.00 per month while others charge from $400 to $550 per year.  

QUESTION 3: Specific list of eligible purchases?

ANSWER: Self-directed Solo 401k plans may be invested in any investment not disallowed under the IRS code.  Examples of allowable Solo 401k investments include real estate, precious metals, promissory notes, tax liens, private company shares, equities and commodities.

QUESTION 4: What bank do you set these up in?

ANSWER: The self-directed solo 401k bank account can be setup at any bank or credit union. A brokerage account may also be opened at Charles Schwab, Fidelity or TD Ameritrade with a checkbook feature as long as the solo 401k plan document of a self-directed solo 401k provider is adopted and submitted with the applicable brokerage account forms.

Thank you

Steve

QUESTION: I want to make sure we are ok with something.  My wife, Cindy, has a full-time job. Is it still ok to roll her funds over into my self-directed solo 401k?  Are the 2 bank accounts both going to be in the name of the Solo 401k Trust...one on behalf of me and the other on behalf of Cindy?

Just making sure I understand everything…

Thanks, NB



Answer: Correct in that the 2 bank accounts are for the same Solo 401k plan; however, a separate bank account is required for each Solo 401k participant for holding his or her respective solo 401k plan funds.

Note that your wife can be employed with your business and therefore participate and make contributions to the Solo 401k as long as she receives self-employment compensation, all the while continuing to  have a full-time job and participating in that 401k. The rule is that she cannot exceed the annual 401k contribution limit to all plans combined.

QUESTION:  How hard would it be to set up the checking account for my self-directed Solo 401k with Bank of America? We don't have BOA here either- but I do have accounts with them in North Carolina where I have another LLC with my brother that we buy rental properties through. How difficult would it be to try and set this up through the mail with them? The Solo 401k plan account funds will be used to buy more rentals in NC. Nothing will be staying in HI.

Another option would be to try it with Wells Fargo in North Carolina if they have locations there. I don't want to use a Hawaiian bank- as I won't be staying here more than 3 years and would like to avoid transferring everything to a mainland bank if I don't have to.

Thanks, TW

ANSWER: Out of all the big banks, BOA understands the Solo 401k bank account process the least. Therefore, you may want to consider using Wells Fargo Bank for the Solo 401k checking account. My contact person can assist you in setting up an on-line account if you would like.

Also, we have the necessary paperwork to open a Solo 401k brokerage account with checkbook control at Fidelity, TD Ameritrade or Schwab. Please let me know how you would like to proceed.