Author Topic: Solo 401k for early retirees?  (Read 886 times)


  • 5 O'Clock Shadow
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Solo 401k for early retirees?
« on: May 22, 2017, 10:26:09 AM »
Hi all!

My wife and I have side hustle under an LLC, and have been considering opening up a solo 401k through Fidelity. The ability to save an additional 53k per year from taxes is just too good to ignore, as we are hoping to stash up enough for me to quit my job in the next 5 years or so.

When going through the paperwork to create the solo 401k plan, Fidelity mentioned that we don't have ultimate flexibility to just cancel the plan whenever we want and transfer it back into a traditional IRA - there needed to be a "qualified event" in the eyes of the IRS to bless the dissolving of the 401k.

Unfortunately, I haven't found ANYTHING to clarify what constitutes as a "qualified event." We have a blog and receive some residual income, so it's not like we can simply "quit" and not receive any money going forward, so I am concerned that if we attempt to roll the 401k plan back into an IRA to begin Roth conversion ladders, we may not be able to.

Does anyone here also have similar plans with a solo 401k? What is everyone's understanding of the qualified events that would allow the roll over into the more flexible IRA vehicles?

Thanks in advance!