QUESTION 1: I have made 23k contributions for both 2013 and 2014 as elective deferrals(employee contributions), to the Roth portion of my solo 401k. If our joint income is below the threshold (183K, I think) can I also make a 6k contribution to my regular Roth(not 401k) account?
ANSWER: For 2013 ,provided your filing status is married filing jointly and you AGI is under $178,000, they you can make the full ROTH IRA contribution; however, if your AGI is $178,000 but less than $188,000 then you can make a partial ROTH IRA contribution. Click here to read how to perform the calculation (it is listed below the chart and there is a worksheet in publication 590).
Click here to learn about the 2014 AGI limits as they are slightly higher than 2013.
QUESTION 2: Can my wife who has a 403b at work, also make a roth contribution to her regular roth account?
ANSWER: See above as your spouse would full under the same rules but chances are that when you include her income, you will both fall above the allowable AGI whether making a partial or full Roth IRA contribution.
QUESTION 3: Since we closed and transferred my old Schwab Keough into my new solo 401k plan, do I need to file a 5500EZ to let the govt know it is closed, or do I just note that on the 1040 form, and enclose the Schwab 1099-R showing code "G".
ANSWER: This is a good question and one that I do not know the answer. I reviewed the instruction of Form 5500-EZ and did not see Keogh listed as a type of plan subject to Form 5500-EZ reporting. I recommend calling the IRS to confirm. Here is there phone number: 1-877-829-5500.
QUESTION 4: As I understand it, I cannot transfer a regular Roth into the Roth portion of my solo 401k, but can I create a 2nd solo 401k plan, transfer the funds from my regular roth into the Roth portion of the new solo 401k, and then use both plans to purchase some property, as tenants in common?
ANSWER: No as the ROTH IRA rules do not allow for the transfer to any type of qualified plan in including the ROTH designated solo 401k account. Click here to learn more about this.
QUESTION 5: For 2013 and 2014 I will soon also be making an employer contribution to the non roth portion of my solo 401k. When I make that contribution(s), do I need to make some kind of declaration on that contribution to be deposited to Schwab, what year it is for?. Why I ask is that, at this point, I'm unsure of the exact amount, and don't want to over contribute for 2013, yet I wish to get my 2014 contribution going. Do you have any suggestions?
ANSWER: Because Schwab is not the solo 401k trustee, they will not track your solo 401k annual contributions nor report them to the IRS. Instead they are tracked by you as the trustee of the solo 401k. You can use the solo 401k contribution form located under the Forms Tab of our website to track your solo 401k annual contributions. This form is for you records only. When submitting your annual solo 401k contributions to Schwab, make the check payable in the name of the solo 401k, reference the solo 401k account number and write solo 401k contribution in the memo section of the check.
QUESTION 6: When I die, what kind of rules/tax consequences apply regarding the distribution of assets to my wife, the primary beneficiary.
ANSWER: Click here to learn about the solo 401k decedent rules.
QUESTION 7:Should my wife pass before me, the assets go to my 3 children, the secondary beneficiaries. Are the rules/tax consequences any different?
ANSWER: The distribution rules as slightly different for non-spouse solo 401k beneficiaries. See above link under answer to question 6 for more on this.
ANSWER: For 2013 ,provided your filing status is married filing jointly and you AGI is under $178,000, they you can make the full ROTH IRA contribution; however, if your AGI is $178,000 but less than $188,000 then you can make a partial ROTH IRA contribution. Click here to read how to perform the calculation (it is listed below the chart and there is a worksheet in publication 590).
Click here to learn about the 2014 AGI limits as they are slightly higher than 2013.
QUESTION 2: Can my wife who has a 403b at work, also make a roth contribution to her regular roth account?
ANSWER: See above as your spouse would full under the same rules but chances are that when you include her income, you will both fall above the allowable AGI whether making a partial or full Roth IRA contribution.
QUESTION 3: Since we closed and transferred my old Schwab Keough into my new solo 401k plan, do I need to file a 5500EZ to let the govt know it is closed, or do I just note that on the 1040 form, and enclose the Schwab 1099-R showing code "G".
ANSWER: This is a good question and one that I do not know the answer. I reviewed the instruction of Form 5500-EZ and did not see Keogh listed as a type of plan subject to Form 5500-EZ reporting. I recommend calling the IRS to confirm. Here is there phone number: 1-877-829-5500.
QUESTION 4: As I understand it, I cannot transfer a regular Roth into the Roth portion of my solo 401k, but can I create a 2nd solo 401k plan, transfer the funds from my regular roth into the Roth portion of the new solo 401k, and then use both plans to purchase some property, as tenants in common?
ANSWER: No as the ROTH IRA rules do not allow for the transfer to any type of qualified plan in including the ROTH designated solo 401k account. Click here to learn more about this.
QUESTION 5: For 2013 and 2014 I will soon also be making an employer contribution to the non roth portion of my solo 401k. When I make that contribution(s), do I need to make some kind of declaration on that contribution to be deposited to Schwab, what year it is for?. Why I ask is that, at this point, I'm unsure of the exact amount, and don't want to over contribute for 2013, yet I wish to get my 2014 contribution going. Do you have any suggestions?
ANSWER: Because Schwab is not the solo 401k trustee, they will not track your solo 401k annual contributions nor report them to the IRS. Instead they are tracked by you as the trustee of the solo 401k. You can use the solo 401k contribution form located under the Forms Tab of our website to track your solo 401k annual contributions. This form is for you records only. When submitting your annual solo 401k contributions to Schwab, make the check payable in the name of the solo 401k, reference the solo 401k account number and write solo 401k contribution in the memo section of the check.
QUESTION 6: When I die, what kind of rules/tax consequences apply regarding the distribution of assets to my wife, the primary beneficiary.
ANSWER: Click here to learn about the solo 401k decedent rules.
QUESTION 7:Should my wife pass before me, the assets go to my 3 children, the secondary beneficiaries. Are the rules/tax consequences any different?
ANSWER: The distribution rules as slightly different for non-spouse solo 401k beneficiaries. See above link under answer to question 6 for more on this.
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