401K Basics

My 401K Plan — What is ERISA?

Most people probably do not know what ERISA actually is and, if you are serving as the Trustee of your self-directed 401K plan, you hopefully won’t need to fully understand ERISA. However, if one is involved in any 401K plan, it is vitally important that you have a basic understanding of ERISA so you KNOW whether it applies to you…read more →

SD 401K Plans — Easily Invest in ANY Asset from One Account!

Many promoters of self-directed plans extol the benefits of one bank account for the 401K plan.  While this is certainly permitted with your plan, wouldn’t it be attractive to have an account that literally will let you purchase both traditional and non-traditional assets all from one account?! I use the $1M example….let’s say as the trustee of the plan you…read more →

SD 401K Plans — Need for Trustee

As with any 401K plan, there are many requirements that must be followed in the establishment of the plan.  One of these requirements is for the identification of a plan trustee.  The trustee’s responsibilities are unique and serious in nature as that individual(s) is responsible for the investments of the assets of the plan.  It is a role that has…read more →

Self-Directed 401K Plans — Time to Fund

Just like any 401K plan, you may now wish to fund your plan and maximize it to the highest potential possible.  Of course, you always have and, should exercise, the option of funding your plan with contributions….both employee deferrals and profit share contributions.  But, you have other options available to you, should you desire, get fund your plan as much…read more →

401K Plan Loans — Why 72(p) May be Your Friend

I often receive many inquiries related to loans permitted from a qualified plan, such as a 401K plan, but also including 403(b) and 457 plans.  I always advise that while loan provisions are an attractive feature to a 401K, including a self-directed 401K, it is only my job to educate on what is permissible, and not that they should exercise…read more →

Self-Directed 401K Plans — A Different Type of 401K?!

Well, yes and no.  So, let’s explain. In the eyes of the IRS, a 401K is a 401K.  There is probably no where in the IRS code where you will see any reference to Self-Directed 401Ks, Solo Ks, I-Ks and so on and so on.  All those terms are more marketing driven than actual IRS terms.  However, the IRS does…read more →

See No Evil, Hear No Evil, Speak No Evil – The Dreaded UBIT – Part II

So, let’s apply this to a typical situation with “flips”. UBIT, as you can see from the preceding paragraph can be a bit more tricky. Practically speaking, the types of real estate projects where a self-directed IRA (note for later……I am only referring to IRAs now, not 401Ks) might face UBIT responsibilities are profits generated from “flips” that result in…read more →

See No Evil, Hear No Evil, Speak No Evil – The Dreaded UBIT

When the subject of UBIT (Unrelated Business Income Tax) raises its ugly head, many individuals (including experts in the field) run away from discussing the matter and have a “See No Evil, Hear No Evil, Speak No Evil” mentality. It is very confusing and difficult to understand, even for professionals (e.g, CPAs) in the field. In fact, I want to…read more →

Can a Traditional IRA be Rolled Over into a Self-Directed 401?

Absolutely,  further, most any plan can be rolled over into any 401K plan….self-directed or not.  Noticeable exceptions to this are Roth IRA funds and SIMPLE IRAs in the first two years of existence. What this does mean is that, generally speaking, all 403(b), 457, 401K, and Traditional, SEP and SIMPLE (after the first two years) IRAs can be rolled over…read more →

You Don’t Have to Put All of Your Money in a Self-Directed IRA or 401K

Many people, when first establishing self-directed IRA or 401K accounts, belive it is an all-or-nothing proposition as it relates to the rollover of funds into the new self-directed plan.  In a nutshell, they believe that if they had a $100,000 in an traditional IRA, they would have to transfer or rollover the entire amount into the new self-directed IRA or…read more →