solo 401k account opening questions for more than one spouse (husband and wife owned business)

[Lilly Z.]

If my husband and I share our s-corp ownership, could I still open solo 401k account for my S-corp?

So my husband and I will have seperate solo 401k account under the company solo 401k account, right?

My husband has a w2 from other company, not our s-corp. Could my S-corp still contribute money to his solo 401k without paying any w2 salary to him?

 

Thanks.

Lilly Z.

Contact

[George Blower]

Thank you for posting your questions!

1) A solo 401k may be opened for a business that is owned by a husband and wife provided that (i) at least one person reports earned self-employment income (e.g. w-2 wages from a self-employed business taxed as an S-corp) and (ii) there are no full-time non-owner and non-spouse w-2 employees working for any business owned by either spouse.

2) Each spouse may participate in the Solo 401k provided that each participating spouse is receiving earned self-employment income (e.g. w-2 wages from a self-employed business taxed as an S-corp). The fact that one or both spouses may have a separate w-2 “day job” and even participate in the “day job” 401k plan won’t prevent such spouse from participating in the Solo 401k.

3) In the event that both spouses work in the self-employed business and participate in the Solo 401k, it will be one plan sponsored by the business but each spouse will have separate sub-accounts (e.g. one bank/brokerage account in the name of the plan for the benefit of the wife and a second in the name of the plan for the benefit of the husband).

4) One’s ability to contribute to the solo 401k is a function of the earned self-employment income so if there is no self-employment income then one can’t make Solo 401k contributions (i.e. “you can’t save more than you earn”). As such, if one spouse does not receive w-2 wages from the self-employed business then such spouse can’t participate in the plan and make contributions.

See more:

Invest husband and wife Solo 401k and make contributions

https://www.mysolo401k.net/solo-401k-husband-wife-can-we-pool-retirement-funds-into-one-account/

https://www.mysolo401k.net/self-employed-solo-401k-husband-wife/

https://www.mysolo401k.net/contribute-husband-business-solo-401k-wifes-full-time-job-401k/

George Blower

My Solo 401k Financial

Contact

8004897571 mysolo401k.net