1. Does it make sense to convert contributions to a traditional 401(k)? We'd get the tax benefits now, but our income is likely to continue to rise annually for the rest of our lives if our business ventures go as expected. I don't see how the conversion ladder would work given this. We also expect for our tax rates to be higher later on, but largely be capital gains instead of earned income
Traditional contributions make sense for the folks who plan to reduce their tax bracket in the future. The Roth ladder is the way you convert those contributions into penalty-free cash later. But if you don't believe your tax bracket will be lower later, you might as well make Roth contributions now and save yourself the hassle.
On the other hand, what if your business ventures don't go as expected? By contributing to a traditional retirement account you may end up paying a bit more tax if the business succeeds than you would have with a Roth, but in that scenario you have plenty of money anyway so it's not a catastrophic error. If the business fails, having the ability to defer some tax from a high-bracket year to a lower-bracket year could be a good hedge against a downturn in your business.
Also consider that your current income puts you right around the threshold of the highest tax bracket, depending on deductions and such. If you are over that line, the only way you lose by contributing to traditional is if you remain in the top bracket
and Congress increases tax rates.
2. What happens to the HSA dollars if we end up over-funding it and need to use it before "retirement age"? Assume we can't use it for medical expenses and we end up needing it prior to the time when it could be withdrawn without penalty. What is the penalty? Would we just need to structure the rest of our portfolio to make sure these are the last dollars drawn such that the penalty isn't a risk?
Prior to age 65, you pay your tax bracket plus 20% on non-medical withdrawals. After 65, the 20% penalty goes away but you still pay your regular tax on it. The penalty is only 10% for retirement accounts so you may want to plan on making early withdrawals from those first if necessary.
3. Should we start only contributing the minimum matched through our employer's plan and the excess through our small business plan instead? A SoloK historically has increased our tax rate because we'd have to convert the business income to ordinary income to contribute and thus this has been a constraint. I wonder if being able to self-direct the funds to real estate ventures from my syndicator buddies would be worth taking the small tax hit though
That would be a question for a CPA who has experience with clients with larger amounts of business income, who knows more about the tradeoffs between corporate income, personal income, or whatever the options are in your situation. You could potentially shelter quite a bit of income pre-tax with a solo 401(k), but you'll have to weigh that against whatever the difference in tax rate on the rest of the income would be.