Self-employed Solo 401k Question Answered – Is there a limit on IRA Rollovers to my Solo 401k?

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The solo 401k plan, commonly referred to as self-directed Solo 41k is the retirement plan of choice for self-employed individuals or owner-only businesses including for the features highlighted below:

-The highest contribution limits for any defined contribution plan including up to $57,000 (or even $63,500 if you are 50 or older) for 2020 (for 2021: $58k or $64.5 if you are 50 or older).

-The ability to make pre-tax, Roth, and even Mega Backdoor Roth contributions.

-401k participant loans of up to $50,000

-Invest with checkbook control in real estate, cryptocurrencies, notes, private placements, and other types of alternative investments.

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For over 10 years, My Solo 401k Financial is the leading self-directed solo 401k provider having helped over 8,000 clients take control over their retirement funds by focusing on superior knowledge, expertise, and customer service with over 100+ 5-star verified customer reviews on the Better Business Bureau (BBB)….(read more)

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As a self-employed individual or small business owner, opening a Solo 401k plan can be a smart financial move to help secure your future retirement. It allows you to contribute more than a traditional IRA or Roth IRA and potentially save on taxes.

However, one question that often arises is whether there is a limit on IRA rollovers to a Solo 401k. The good news is that you can roll over a virtually unlimited amount from traditional IRAs, SEP IRAs, SIMPLE IRAs, and even 401k plans from previous employers.

This means that you can consolidate your retirement accounts and take advantage of the benefits of a Solo 401k, such as higher contribution limits, the ability to borrow against it, and potential tax savings.

But before you go ahead and roll over all your retirement accounts, it’s important to understand the rules and regulations that govern Solo 401k plans. Here are a few key points to keep in mind:

– While there is technically no limit on the amount you can roll over from other retirement plans, there is an overall contribution limit for your Solo 401k. For 2021, the maximum contribution is $58,000 or $64,500 if you are age 50 or older.
– You can only roll over pre-tax funds into your Solo 401k, not after-tax or Roth funds. If you have after-tax or Roth funds in your other retirement accounts, you may want to consult with a financial advisor to determine the best strategy for maximizing your contributions.
– You must complete the rollover within 60 days of receiving the distribution from your other retirement account. If you miss this deadline, you may be subject to taxes and penalties.
– It’s important to keep accurate records of all rollovers and contributions to your Solo 401k. This will be important come tax time and can also help prevent you from exceeding contribution limits.

In conclusion, there is no limit on IRA rollovers to your Solo 401k, but there are rules and regulations that govern the process. By understanding these rules and working with a financial advisor, you can take full advantage of the benefits of a Solo 401k and streamline your retirement savings.