Author Topic: Moving SEP-IRA funds to Solo 401k?  (Read 731 times)

Much Fishing to Do

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Moving SEP-IRA funds to Solo 401k?
« on: February 21, 2018, 11:41:10 AM »
I started a SEP-IRA for my business years ago.  At one point it made sense for me to create a solo 401k (same business) so I did that and that is what I currently contribute to (there's about 300k in the traditional part of it, about 60k in a Roth part).  The SEP-IRA funds I never moved, they are currently worth about $90k.  Can I move the SEP-IRA funds to the solo 401k and if so are there any real advantages/disadvantages to doing so?  Its all currently held thru Vanguard.

PDXTabs

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Re: Moving SEP-IRA funds to Solo 401k?
« Reply #1 on: February 21, 2018, 01:26:48 PM »
I am not a tax lawyer or an accountant, but the IRS has this handy table:
https://www.irs.gov/pub/irs-tege/rollover_chart.pdf

As far as I know that would be a rollover from a SEP-IRA to a Qualified Plan (pre-tax), and as such allowed.

terran

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Re: Moving SEP-IRA funds to Solo 401k?
« Reply #2 on: February 21, 2018, 09:51:44 PM »
Yes, it is legal, but not all plans allow incoming rollovers. Fidelity does, vanguard does not. Not sure about others.

Unrelated, but since you probably recently crossed $250k, make sure you're filing form 5500 for your 401k. There are some nasty penalties if you don't that keep going up the longer you wait.

Much Fishing to Do

  • Bristles
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Re: Moving SEP-IRA funds to Solo 401k?
« Reply #3 on: February 22, 2018, 05:38:48 AM »
Thanks Terran -
OK, that makes sense with my difficulty in figuring it out for Vanguard.

I realized (just in time) to start filing that 5500, given you don't have to at first its very easy to forget about when time to does come around so a very helpful heads up to all.

terran

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Re: Moving SEP-IRA funds to Solo 401k?
« Reply #4 on: February 22, 2018, 01:22:07 PM »
I realized (just in time) to start filing that 5500, given you don't have to at first its very easy to forget about when time to does come around so a very helpful heads up to all.

Yeah, I haven't had to yet, so I'm just hoping if I keep reminding people that will help me remember when the time comes :-)