QUESTION & BACKGROUND:
Here we are having a pickle trying to sell one of the properties we bought with the solo 401K solo account and I hope you could give us your insight on it.
The escrow officer doing the escrow says he sees a problem because the property deed is under the name of the solo 401k FOB my name. The title co officer suggests that the sol0 401k trust deeds the property to our self-employed LLC, and the tax assessor agrees that would be the fix, yet I wonder if that would be ok with the mechanics of the solo 401k FOB my name? What are your thoughts?
I’m glad that you reached out before entering into a taxable distribution. You are not allowed to transfer property owned by the solo 401(k) plan to your own LLC or to yourself.
Please see the following procedure to share with the title company that applies to the sale of property owned by the solo 401(k) plan. https://www.mysolo401k.net/solo-401k/property-sale-procedure-for-self-directed-solo-401k-owned-real-estate-property/
What is more, even though a solo 401k like an IRA falls under the trust umbrella, specifically a retirement trust, neither 401(k) plans nor IRAs are registered with the state. Instead they fall under the IRS regulations.