Form 1099-R, Distributions From Pensions, Annuities, Retirement, or Profit-Sharing Plans, is used to report passive income and distributions from a retirement plan that exceeds $10 in value. The purpose of Form 1099-R is to report the taxable amount of the distribution and any applicable taxes withheld. The form provides information to the recipient and the […]
If you have an IRA with Vanguard and are considering moving your assets to a self-directed solo 401k, here are the steps to performing a rollover without triggering any taxes and penalties. Steps to move your Vanguard IRA to a self-directed solo 401k To transfer your funds from your Vanguard IRA, you must send them […]
If you’re the owner of a solo 401k plan, here are some important forms that you may be required to file depending on your account activity. Overview Form 5500-EZ Form 5500-EZ is an annual tax return required for all solo 401k plan owners with over $250,000 in plan assets. It’s essentially a yearly summary of […]
OVERVIEW There are only two eligibility requirements for a solo 401k: Business owners with any type of business entity can open a solo 401k as long as they generate income and they don’t have employees. But what happens if you decide to hire a full-time W-2 employee, and you’re no longer self-employed? Can you keep your account, or […]
A 401k is an employer-sponsored retirement plan. Without an employer, you cannot participate in a traditional company 401k plan. However, there are some strong alternatives that offer even better benefits and tax-advantages than a normal 401k. Perhaps you’re already employed, but your company just doesn’t have a 401k plan that they offer to employees. 401k […]
Steps to close your solo 401k plan A solo 401k requires that you have self-employment activity with no employees, including part-time employees who are at least 21 years of age, and have worked over 500 hours per year for 3 consecutive 12-month periods (excluding your spouse). If you do end up hiring an employee, you […]
A Roth IRA is an individual retirement account that could be a powerful vehicle to save for your retirement. Contributions are made with post-tax income (money you’ve already paid income taxes on), but your withdrawals in retirement are completely tax-free, no matter how large the gains. A Roth IRA is also one of the most […]
BASIC WITHDRAWAL RULES OF A ROTH 401K A Roth 401k has slightly different withdrawal rules than a normal 401k. With a Roth 401k, you contribute to your account with after-tax dollars and withdrawals in retirement are completely tax-free. Like a traditional 401k, you must wait until you’re at least 59½ years old before you can take […]
When you contribute to a 401k or 403b retirement plan, you can choose whether they’re pre-tax contributions or post-tax contributions. If you choose pre-tax deferrals, your contributions get deducted from your taxable income. You get to pay less taxes the year you contribute, but you’ll have to pay taxes when you withdraw from your account […]
