The Self-Directed Solo 401k plan is an IRS-approved and qualified 401k plan designed for a self-employed sole proprietor, a corporation, or limited liability company.

The self-employed 401k participant can make contributions as both the employee and the employer resulting in very high contribution limits.

Our team likes to refer to the Self-Directed Solo 401k as a Self-Directed IRA on steroids! This is a very powerful tool with a wealth of benefits!

 Higher Contributions

•  2022 Annual contributions up to $61,000 with an additional $6,500 catch-up contribution for those over age 50.

                •  2023 Annual contributions up to $66,000 with an additional $7,500 catch-up contribution for those over age 50.

 Borrow from Your Self-Directed 401k (Tax- And Penalty-free)

•  Borrow up to $50,000 or 50% of your account value (whichever is less) for any purpose. Loans must be paid back within 5 years.

 Checkbook Control

•  Plan participants may have the option to have checkbook control over their retirement funds. American IRA acts as the record keeper for the Self-Directed Solo 401k plan.

 Roth Provision

•  A built in Roth provision is included which can be contributed to without any income restrictions.

 Easy Administration

•  You are the trustee of the plan. American IRA acts as the record keeper.

 A Wealth of Investment Options

•  You can invest in real estate, private lending, limited liability companies, precious metals, tax liens, and much more!

 Exemption from UDFI

•  With a Self-Directed Solo 401k plan, you can use leverage to purchase real estate, which may be exempt from.

 Consolidate Accounts

•  Most of your other retirement accounts for example: 401k from other employer, SIMPLE IRA, SEP IRA, 403(b), 457(b), and Traditional IRA.

Note: Only new Roth contributions are allowed in a Solo 401k, existing Roth funds can’t be transferred or rolled in.

The newly released 2022 contribution allows the business owner to wear two hats in a 401(k) plan: employee and employer. Contributions can be made to the plan in both capacities. The owner can contribute both:

• (Employee)Elective deferrals up to 100% of compensation (“earned income” in the case of a self-employed individual) up to the annual contribution limit:
  • $20,500 in 2022, or $27,000 in 2022 if age 50 or over;
  • $22,500 in 2023, or $30,000 in 2023 if age 50 or over; plus
• Employer non-elective contributions up to:
  • 25% of compensation as defined by the plan, or
  • for self-employed individuals, see link below

Source of contribution limits: www.irs.gov

To be eligible to benefit from the wealth of possibilities within a Self-Directed Solo 401k plan, investors must meet two requirements:

 The presence of self-employment activity.

 The absence of full-time employees.

Keep in mind if you and/or your spouse are the sole owner(s) of the business both can contribute to their individual accounts within the Self-Directed Solo 401k.

There are certain employees that you can employ which can be excluded from your plan:

 Employees under the age of 21 years old.

 Employees who work less than 1,000 hours in any year.

 Non-resident alien employees with no U.S. income.

Keep in mind that even if you do not qualify for this plan, we have many other plans that you do qualify for.