Steps for Establishing & Funding Your Solo-K

Prior to establishing your Solo-K, you want to make sure that you meet the IRS’ requirements for sponsoring your Solo-K plan. The business structure you elect/hold can be a sole proprietorship, LLC, S-Corp, C-Corp, or Partnership. Also, every State can be different in their licensing/registration (if any) requirements for business structures. You will want to make sure you are aware of all State regulations, if any, governing your business structure.

While plan document sponsors such as PGI will/should do their best to ensure you meet the criteria to establish the Solo-K, it is the client’s responsibility to ensure they meet and adhere to any State/Federal requirements related to their business structure.

However, assuming you are structured how you wish and are ready to start with the establishment of your Solo-K, what are the basic steps in getting you started?

Let’s Visit

PGI likes to visit with you so we have a strong understanding of what you are wanting to accomplish. We will do our best to make sure your Solo-K plan meets your needs. PGI sincerely believes that the conversation is of great benefit to both of us. No “elevator pitch”, rather a conversation to determine what plan is in your best interests moving forward. As the saying goes, “a well-informed client is a good client.”

Docu-Signed Engagement Form

Once you are ready to start the process for your Solo-K, it is as easy as contacting PGI and asking for us to send you the engagement form. You will be able to complete via DocuSign and return to PGI.

EIN for Plan

PGI will secure the EIN for your plan. Even if it was not required, you would want the EIN for a number of reasons. In order for any third party, including PGI, to secure an EIN on behalf of anyone, we must have your permission. PGI will send you a completed IRS SS-4 Form for you to authorize through your signature. The SS-4 Form is only used to secure authorization and is not filed with the IRS.

Trustee for your Solo-K

Unlike an IRA that requires an IRS-approved custodian to fulfill that role, you will not need a custodian with your Solo-K. You will serve as the Trustee for your plan unless you assign it to another individual.

“Host” Account for your Solo-K

Open your account at a local bank or any brokerage firm (e.g., Schwab, Fidelity, TD Ameritrade, E*Trade) that PGI works through and permits these types of accounts. You can even open an account for the 401(k) at a bank and brokerage firm. You are not opening up 2 Solo-K Plans, rather having two accounts at your disposal for the 401(k) funds. PGI will prepare all the applications for your brokerage account, whether it be Charles Schwab, Fidelity, TD Ameritrade or E*Trade.

Prep, Filing & Registration of your Solo-K Plan Documents

PGI will prepare, file and register your Solo-K plan documents for your business.

Rollovers Coming into the Solo-K

While PGI cannot request your rollover funds for you, we will make sure we explain the exact process for requesting the rollover so it is executed in a timely and efficient manner….and how to make sure you correctly report the rollover on your 1040 tax return for the tax year in which the rollover occurred.