Solo 401(k) Plans

If you are a small business owner and would like to maximize your annual retirement savings contributions, the Solo 401(k) Plan may be the best vehicle for your purpose.

Who may set up a Solo 401(k) Plan?

• Business owners with no full-time employees* other than a spouse
• Partnerships whose only employees are partners owning more than 5%
• Independent contractors with no employees (receiving 1099 pay)
• Businesses who are independent from any other affiliate or corporation
• Business owners (and spouse or partners) who own 100% of the business

What are the advantages of a Solo 401(k) Plan?

• Potentially higher contribution limits than other types of plans
• Large personal tax savings
• Wide range of investment possibilities
• Borrow from your account up to IRS limits
• Annual funding flexibility
• Opportunity to consolidate existing retirement accounts

What else do I need to know about setting up a new Solo 401(k) Plan?

• Get your accountant and legal counsel’s stamp of approval prior to setting up a Solo 401(k) Plan
• Work with your investment advisor to set up your account and assist in fund selection
• QPC drafts all required plan document materials, (Adoption Agreement, Resolution, TIN, etc.
• QPC will perform annual limits testing to keep plan compliant with regulations

Employees who work more than 1,000 hours a year are considered full time.  Employers generally may exclude the following employees from participation in a Solo (k) plan: those who are under age 21, those who work less than 1,000 hours per year, those who are covered by a collective bargaining agreement, and those who are nonresident aliens with no U.S. source income.