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Solo 401k FAQ

You’ve got questions, we’ve got answers! Read on to learn the answers to the most frequently asked questions about the Solo 401k plan.

  • What is the Solo 401k? The Solo 401k is a special type of retirement plan for business owners (and their spouses). In many ways, the Solo 401k functions like a corporate 401k plan but allows you greater freedom to invest in what you want, and contribute on your own schedule because you are your own 401k plan administrator and trustee.
  • What do I need to qualify for a Solo 401k? There are two elements needed to qualify for a Solo 401k: 1) The presence of self-employment business activity and 2) the absence of full-time employees. Please see our page on Solo 401k qualification for more information.
  • How long does it take Nabers Group to set up the Solo 401k? The application will only take you about 10 minutes. After you submit your application to us, we’ll have your documents prepared and delivered to your private encrypted 401k document dashboard in just a couple hours! You have access to your private 401k dashboard 24/7 so you can begin a rollover at 2 am without waiting for someone to have to send you any paperwork. However, the Nabers Group team is available by online chat during business hours to answer any of your questions and make sure you’re well supported.
  • What can I rollover into the Solo 401k? You can rollover almost any type of retirement plan into the Solo 401k, including a traditional IRA, another 401k plan, 403b, pension plan, TSP, etc. The only retirement plan that cannot roll into a Solo 401k is a Roth IRA as per IRS rules.
  • Who helps me do the rollover? The Nabers Group team is here to help every step of the way. Our revolutionary proprietary software will help you complete and generate a rollover packet to send to your current custodian in 2 minutes or less. Your rollover packet includes all the relevant compliance paperwork proving your Solo 401k is an IRS-approved plan, including a copy of our IRS Opinion Letter, and even sample 1099-R so your custodian can document the rollover as a direct rollover.
  • Where do the rollover funds go? Does Nabers Group manage the 401k? You’ll receive a check in the mail for your rollover funds with the check made payable to your new Solo 410k trust. Nabers Group never touches your money so it’s safe in your hands as your own 401k trustee. Nabers Group is not a custodian so we don’t manage your investments. You are your own custodian, giving you full freedom and flexibility to invest your funds any way you choose.
  • Do I have to rollover everything? You can rollover a portion or all of your funds into the Solo 401k plan. It’s your choice.
  • Can I rollover assets or only cash? You can rollover cash and/or in-kind assets. Our rollover paperwork will give you a section to note if and how you’d like to rollover in-kind assets such as stocks, bonds, or even real estate.
  • How much can I contribute to the Solo 401k? As of 2024, you can contribute up to $69,000 (or $76,500 if you are age 50 or older). If your spouse participates in the Solo 401k plan with you, double that contribution amount!
  • Can I have a Solo 401k and my corporate (regular) job at the same time? Yes.
  • Can I contribute to both the Solo 401k and regular 401k plan at the same time? Yes! The Solo 401k has two types of contributions: employee (salary deferral) contributions and employer (profit-sharing) contributions. Your employee contributions are limited to $23,500 across all 401k plans (or $31,000 if you are age 50 or older). That means if you are contributing $10,000 to your regular 401k at work, you would be able to contribute the remaining $13,500 to your Solo 401k plan. Employer (profit-sharing) contributions stand alone so the amount you contribute to the employer portion of your Solo 401k plan does not affect your regular job 401k because they are two distinct employers/businesses.
  • Can my spouse or I own a business that has full time W2 employees? No. If you or your spouse own a business that has W2 employees who work more than 1000 hours per year, you do not qualify for a Solo 401k account and the Checkbook IRA is the best type of Self-Directed retirement account for you.
  • What if my business has partners but no employees? No problem! We’ll write a special type of Solo 401k plan for you (for a small additional fee) where your business partner is excluded from participating in your plan. This allows the plan to remain truly “Solo”.
  • Can my spouse participate in my Solo 401k? If your spouse performs services for the business and receives compensation, s/he can participate in the Solo 401k and get his/her own set of annual contributions, rollovers, and line of credit.
  • How much do I have to contribute to the Solo 401k each year? There must be intent to earn revenue and make contributions to the Solo 401k, but there are no minimum annual amounts. The IRS does not discriminate against business owners with a required minimum business success, and today it’s easy to have some amount of legitimate business activity each year.
  • What kind of paperwork does the IRS expect me to file? The Solo 401k is a retirement account and is tax-deferred, therefore there is no tax return due for a Solo 401k plan. Once you have $250,000 or more in total plan value (add up all your assets and cash in the plan), you will file form 5500-EZ. If you have less than $250,000 in your 401k plan, nothing needs to be filed. The Nabers Group team has guides and articles to guide you and your CPA through successfully completing this form. Our clients have told us that with the help of our trainings and guides, the 5500-EZ took them less than 10 minutes to complete!
  • What paperwork will Nabers Group provide me for setting up the Solo 401k? You’ll receive everything to prove your 401k plan is approved by the IRS. The documents will include your Adoption Agreement, Appointment of Trustee, Action by Board of Directors (to adopt your 401k plan), beneficiary designation forms, in-plan Roth conversion forms, Basic plan document, trust agreement, new trust tax ID number for your 401k trust, IRS opinion letter proving the legitimacy of your 401k plan, death distribution forms, required minimum distribution forms, rollover acceptance forms, investment documentation forms, contribution forms, rollover assistance and all participant loan documents including the loan promissory note, amortization schedule and loan repayment schedule.
  • Is the Solo 401k by Nabers Group approved by the IRS? Where’s the proof? Yes, we were the very first non-custodial document provider in the industry and have been setting up Solo 401k plans since 2006 when the Solo 401k first came into existence. Your Solo 401k plan includes a copy of our IRS Opinion Letter proving our 401k plan and trust have been approved by the IRS. We work with the IRS and DOL on a consistent basis to ensure our documents are up to date and afford the greatest freedoms to Solo 401k accountholders while maintaining the strictest compliance standards.
  • Who is the custodian? You are! Because the Solo 401k trust only has your retirement funds, as opposed to a big corporate 401k where all employee funds are in one trust account – you are allowed to be your own trustee and the custodian of your own retirement funds. Breathe in the smell of freedom!
  • What can the Solo 401k invest in? Almost anything, from real estate, to digital assets like cryptocurrencies, traditional equities (stocks, bonds, ETFs), tax liens, private equity, promissory notes, mortgage notes, hedge funds, precious metals and more.
  • Does Nabers Group complete due diligence on my investment for me? Because you are your own trustee and your own plan administrator, you are responsible for doing due diligence on your own investments. Nabers Group is not allowed to be your compliance office though we strongly recommend you work with your CPA and/or tax advisor to ensure your deals pass muster.
  • Do I need a separate Solo 401k if I want to use Roth funds? The Solo 401k by Nabers Group automatically includes a Roth sub-account. This saves you time and money since your Solo 401k is already setup to give you the greatest flexibility and freedom to invest and save your funds according to the strategy that works best for you.
  • How do I borrow from the Solo 401k? What are the limits? Taking a participant loan from the Solo 401k with Nabers Group can be done in 60 seconds or less. Our proprietary software will draw up your promissory note, loan amortization schedule and repayment schedule immediately for you and you can access your 401k dashboard 24/7. Your loan can be 50% of your account value, maxing out at $50,000. Each plan participant (you and your spouse, typically) can take the participant loan. You have 5 years to pay the loan back (or 15 years if the funds will be used to pay for your primary residence). Any interest earned on the loan goes right into your 401k trust bank account (no middleman, no custodial fees). Nabers Group does not charge anything to prepare your loan paperwork.
  • What do you charge if I want to shut down the Solo 401k? We don’t charge you to shut down your plan. We’ll even help you open a new IRA and roll your funds into that account if you are shutting down the Solo 401k due to closing down your business.
  • How can I refer people to Nabers Group? Do I get a referral commission?  Absolutely and we love working with friends, family and colleagues of our clients. Fill out this form to refer a friend to Nabers Group.
  • Is the Solo 401k an ERISA plan? ERISA came into existence to protect plan participants and give them a fair shot (e.g. funding, vesting, etc). Because you (and maybe your spouse) are the only participants of the Solo 401k plan, Title 1 of ERISA does not apply since you probably won’t defraud or hurt yourself. However, even though Title 1 of ERISA doesn’t generally apply to Solo 401k plans, like any other retirement plan you are still protected from outside creditors and must still abide by the prohibited transaction rules.
  • Why do I have to pay an annual maintenance fee? Your business is adopting the Nabers Services Solo 401k plan and trust that has received IRS approval. The annual maintenance fee allows you permission to continue using the documents, as well as gives you access to any and all plan updates, amendments and/or restatements all for one low flat fee. The annual maintenance also gives you ongoing support from our team, and access to our exclusive 401k-accountholder only trainings.
  • I don’t qualify for the Solo 401k, but I want to. What can I do to start a business quickly and easily?  Contact us for a free report that outlines what millions of Americans are doing to take advantage of simple, efficient business ownership in the modern Information Era.

Solo 401k

$499 one-time setup
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