QUESTION: My wife is a Realtor and Appraiser and we have a couple of rental properties we manage/lease. So our home business is mainly real estate oriented. Where I help out in all of this is general maintenance/upkeep of rentals, fielding calls with new tenants, the occasional real estate' for sale' sign install and picture taking of listings she has had or appraisals she is working on, etc. Would this fit the bill as part-time self-employment activity for me?
 
ANSWER:Good question and yes you are both essentially performing self-employment activity through real estate activity as sole proprietors which means you will each need to file a separate Schedule C (Form 1040) to report your respective part-time self-employment activity. 
 
QUESTION: If so, would we have to set an individual Solo 401k’s for each of us, or is it one Solo 401k with accounts for the wife and myself since it is basically one business?
 
ANSWER:You can both participate in the same solo 401k since you are married and both performing self-employment activity in the same line of business; however, you would each have a separate brokerage account under the plan to separately hold both of your respective retirement funds.
 
QUESTION: Would it be smart to setup the Solo 401k before requesting the rollover into it so I can give Fidelity the new retirement account info to note it on the check they will be cutting? I don’t want put myself into a situation where a check payable to only me (income tax and penalty).
 
ANSWER:Yes the solo 401k plan first must be adopted (i.e., all the 401k adoption documents must be signed) before you can request the non-taxable transfer to it. 
 
QUESTION: And lastly, what do we need to do to move forward to set up the Solo 401k(s)?

ANSWER: Once you are ready to proceed, you can call us and we will walk you through our on-line application, or you can proceed on-line using the following link:http://www.mysolo401k.net/solo-401k/open-a-solo-401k-account/

 

QUESTION: I think I know the answer to this but so far I haven't been able to find anything on the internet that directly says you cannot do this. My realtor wants to open a solo 401k and then buy a property that is 75% owned by himself and 25% owned by the solo 401k. Is this possible if you keep good records and show that 25% of the expenses and income are coming from or going to the solo 401k?

ANSWER:You are correct that it is prohibited for the solo 401k owner to purchase a property that has ever been owned by him or her. This would be in violation of the following rule.

Sale, exchange, or leasing of property between a plan and a disqualified person;


See following links for more information.

http://www.mysolo401k.net/self-directed-401k-prohibited-transaction-4975/

http://www.mysolo401k.net/prohibited-transactions-solo-401k/