Hi All, I just opened my Solo 401(k) - thanks to Mark Nolan and mysolo401k.
I have identified a property, and have a few questions with regards to the best way to go forward.
1) The property will be a buy and hold. Is it recommended to set up an LLC owned by the 401(k)? If LLC is recommended, what is the process for setting up the LLC to allow for the purchase of the property? Should the LLC be a property management business?
2) How do I insure the property? I expect that the property has to be ensured under it's own account and cannot be listed under my personal residence policy. Can anyone recommend an insurance company that helps insure properties purchased with solo 401(k)s?
Thanks in advance for your advice and your patience in dealing with the simple questions of a newbie.
These are good questions for your plan provider. Hopefully they can help you.
1) You don't need to have the LLC, 401k Trust can hold property title. But in some cases LLC will make sense depending on your particular situation.
2) All transactions involving 401k must be 'arms length' so you are correct that you can not list that property on your personal insurance. You don't need 'special' insurance company, most should be able to insure the property.
Thank you for your response. You are always so helpful in your posts.
You are welcome @Leslie Griffith .
I will send you and e-mail shortly regarding your questions.
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