UBIT impact on a syndication investment within SD Solo 401K

[Mano Chidambaram]

Has anyone invested in a syndication investing in an ongoing business, not real estate, using their SD Solo 401K & what was the UBIT impact on the returns? Any other factors to consider to minimize the UBIT impact? Thanks

[George Blower]

@Mano Chidambaram

Generally UBIT applies to equity investments in entities that offer goods or services that are not setup as C-corps.

A common way to avoid UBIT is to process the investment as a promissory note instead of an equity investment.