Menu Close

IRA Financial Group Blog

Solo 401k Plan Documents – Important!

Solo 401(k) Plan Documents

A Solo 401k is a retirement plan that allows individuals who are self-employed to maximize their retirement contributions. If you’re a small business owner or earn self-employment income, you can establish a Solo 401k plan and contribute up to $56,000, as well as an employee deferral of $19,000.

Solo 401k Plan Documents

After setting up a Solo 401k, the IRA Financial Group will make the process of adopting the Plan simple and straightforward.

Adoption Agreement:

The Adoption Agreement is the operating document that adopts the Qualified Retirement Plan. The IRA Financial Group’s retirement tax professionals will review the Adoption Agreement with you, complete all necessary information, and make appropriate elections where necessary.

Basic Plan Document:

The Basic Plan document is the Prototype Plan and Trust document that sets forth the rules of the Solo 401k Plan. The IRA Financial Group’s retirement tax professionals will review the Basic Plan document with you so you have a full understanding of all the provisions of the plan.

EGTRRA Amendment:

In the case of any amendment to the plan documents required by Economic Growth and Tax Relief Reconciliation Act (EGTRRA), the Plan sponsors must make good-faith efforts to amend their plans accordingly. The IRA Financial Group will provide you the necessary documents to amend the Plan documents as required by law.

Summary Plan Description:

The Summary Plan Description summarizes the important features of the Plan document, including your benefits and obligations under the Plan. The IRA Financial Group’s retirement tax professionals will review the Summary Plan Description document with you so that you have a full understanding of all the provisions of the plan.

Trust Agreement:

The Trust Agreement in the Basic Plan documents sets forth the responsibilities and duties of the trustee. The IRA Financial Group’s retirement tax professionals will review the Trust Agreement with you so that you have a full understanding of all the provisions of the Agreement.

Appointment of Trustee:

The Adoption Agreement appoints the person that will serve as trustee of the Solo 401kPlan. Typically the owner of the entity is appointed as trustee. The IRA Financial Group’s retirement tax professionals will help you understand all matters relating to serving as Trustee of the Plan.

Beneficiary Designation:

As part of establishing a Solo 401k Plan, you will need to designate primary and contingent beneficiaries of your Solo 401k plan in the case of your death. The IRA Financial Group’s retirement tax professionals will help you understand all relevant issues relating to the designation of beneficiaries.

Loan Procedure:

The Basic Plan documents will allow you to use a loan from your Solo 401k Plan for any investment purposes, including real estate, funding your business or a new business, tax liens, private placements, etc.

The Basic Plan document allows participants to borrow up to $50,000 or 50% of their account value (whichever is less) for any purpose. The IRA Financial Group’s retirement tax professionals will help you understand the procedures for establishing a loan and offer guidance on using the loan as a tax planning strategy.

Loan Documentation:

The Basic Plan documents include all the loan documentation required to take a loan from your Solo 401k Plan, including:

  • Loan Application form
  • Lending Disclosure Statement
  • Loan Agreement

The IRA Financial Group’s retirement tax professionals will help you understand all the loan documentation with respect to the Solo 401k Plan.

Transfer Request Forms for incoming funds transfers:

The Plan documents include Transfer Requests forms to assist you in transferring funds from your current trustee or custodian. The IRA Financial Group’s retirement tax professionals will help you understand all the transfer rules relating to establishing a Solo 401k Plan and will help you determine the most tax advantageous manner for transferring funds.

Newly assigned Employer Identification Number from the IRS:

The IRA Financial Group’s retirement tax professionals will acquire an Employer Identification Number from the IRS for your Trust that will hold the Solo 401k assets.

IRS Determination letter stating that this is a Prototype Plan that meets the requirements of a qualified plan:

The Basic Plan documents will include an IRS Determination letter stating that this is a Prototype Plan that meets the requirements of a qualified plan.

What do I need to get Started?

IRA Financial Group will take care of everything.

We can handle the entire process your way: phone, email, fax or mail. Our expert tax and ERISA specialists greatly reduce the set-up time and cost of setting up a Solo 401k.

More importantly, you will see that IRA Financial Group offers services at a significantly lower fee than other companies performing the same or similar services.

Get in Touch

Do you still have questions regarding Solo 401k plan documents, or setting up a Solo 401k? Contact IRA Financial Group directly at 800-472-0646. You can also contact a 401(k) specialist by filling out the form and they’ll get back to you promptly.

Related Articles