All Forum Posts by: George Blower

@Doug Phillips

Try to max out your Roth 401k contributions as those source of funds will grow tax free.  

@Kenneth Nelson

Welcome to BP.

@Jacob Huelsman

Welcome to BP.

@Tristan Toliver

Welcome to Bigger Pockets.

@Roman M.

Yes, the solo 401k funds can be invested right away; however, the IRS prohibited transaction rules would preclude you from using the solo 401k owned property for business or personal use.

@Roman M.

You mention that you are self-employed. 

If you are self-employed with no full-time w-2 employees, you can set up a Roth Solo 401k which enjoys certain advantages over a Roth IRA.

Higher Contribution Limits:

• Roth Solo 401k accounts enjoy much higher contribution limits than Roth IRA accounts.
• For example, if you select a Solo 401k provider which allows for voluntary after-tax contributions and in-plan conversion to a Roth sub-account (and you have sufficient self-employment), you would be able to make a combination of Roth and voluntary after-tax contributions for 2019 which would result in up to $56,000 (or $62,000 if you are 50 or older) in your Roth Solo 401k sub-account.  

Exempt from Unrelated Debt Finance Income Tax:

• While investment income from real estate that is acquired with debt (which must be non-recourse financing) and held in a Roth IRA is subject to UDFI tax, the same property held in a Solo 401k is generally exempt from UDFI tax.

@Daniel Brummell

Welcome to BP.

@Daimily Santiago-Leon

Welcome to BP.

@Anthony J Ruma

Welcome to BP.

@Christa S Rickard

To add some more detail to the conversation: please note that it's possible to invest via a Roth Solo 401k which would result in tax-free gains if you satisfy the qualified Roth distribution rules (typically you have had the Solo 401k Roth account for both 5 years and you are at least 59.5 years of age).