Questions About 401k Rollover
I’m in the process of doing a 401k Rollover and have few questions
Question: If my 401k Rollover is from a former employer’s 401k plan where the funds were drafted pretax, do I now transfer the funds to the Solo 401k checking or savings account? Does it matter whether it is checking or savings? I cannot transfer into the Roth 401k right?
Answer: It doesn’t matter if the funds go into checking or savings, both of the account are under your Solo 401k. Pre-tax money can not go into Roth, you can do the conversion after you transfer, if you wish. Be sure to consult with your accountant or another tax expert about the tax liability.
Question: If I am rolling over IRA funds from a third party fund like Equity Trust, then I would transfer to the Solo 401k checking or savings? Even though these are IRA funds?
Answer: The funds from Equity Trust IRA can also go into either checking or savings account, assuming the IRA you are referring to is Traditional, not Roth.
Question: If I am rolling over mutual fund savings from an account like John Hancock, then I would transfer to Solo 401k checking or savings?
Answer: Is John Hancock your personal account (not retirement account)? If that is the case you can not move those funds over. Only qualified retirement funds can be transferred/rolled over into Solo 401k (except Roth IRA). You are not allowed to commingle your personal savings with your retirement funds, they must be kept separate at all times. By mixing personal and retirement funds together you are committing prohibited transaction and your 401k will be deemed disqualified.