Solo 401k Loan3 Replies
September 2, 2021 at 5:24 pm
I would like to take a loan against my solo 401k. I currently have a Schab Account, no other solo401k accounts.
I have a question regarding step 5 – is Schwab my ‘solo 401k bank account’ or do I need to open a solo 401k checking account?:
Repay the Solo 401k Loan
Loan payments are made by check from your personal checking account (not your Solo 401k bank account) payable in the name of the Solo 401k plan.Write “Participant Loan Payment” on the memo section of the check.As trustee of the Solo 401k, deposit the Solo 401k loan payment checks into the solo 401k bank account.Tracking the loan payments: the loan payment schedule serves this purpose along with the Solo 401k bank account statement history.
Top ForumsMega Backdoor Roth Solo 401k, Solo 401k Bank AccountSeptember 3, 2021 at 7:57 am
Thanks for posting your question!
You do not need to open an additional bank account for your solo 401k. You can simply make payments to your Schwab solo 401k account instead of a “bank account” for your Solo 401k.
Please see more information below regarding making 401k loan payments to the brokerage account at Schwab for your solo 401k:
Making 401k loan payments to Schwab account(s) – Paper & Electronic
One option would be to go to the local Schwab branch and make 401k loan payments by paper check (e.g. pre-tax contributions to the pre-tax account, voluntary after-tax contributions to the after-tax account, etc.)While Schwab won’t allow you to electronically transfer funds to the brokerage account from an external account not titled in the name of the plan, one option is to open a personal brokerage account at Schwab in your name, fund the brokerage account in your name, and then transfer the funds from the brokerage account in your name to the brokerage account in the name of the plan in order to make 401k loan payments.
September 10, 2021 at 7:54 am
One more question – where do I send info for Step 1? Is there an intake form or should I email my answers to a specific email address?
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