Text of Presidential Memorandum to Secretary of the Treasury -- Retirement Savings Security

Solo 401k

"(a) By December 31, 2014, you shall finalize the development of a new retirement savings security that can be made available through employers to their employees.




This security shall be focused on reaching new and small-dollar savers and shall have low barriers to entry, including a low minimum opening amount. In developing this security, you shall ensure that it:

(i) protects the principal contributed while earning interest at a rate based on yields on outstanding Treasury securities;

(ii) offers savers the flexibility to take money out if they have an emergency and keep the same Treasury security if they change jobs; and

(iii) is designed to help savers start on a path to long-term saving and serve as a stepping stone to the broader array of retirement products available in today's marketplace.

(b) Within 90 days of the date of this memorandum, you shall begin work with employers, stakeholders, and, as appropriate, other Federal agencies to develop a pilot project to make the security developed pursuant to subsection (a) of this section available through payroll deduction to facilitate easy and automatic contributions."



Solo 401k Plan: Your Opportunity for Checkbook Control of Your Future

SURPRISE!!. YOU MAY BE SUBJECT TO THE NEW 3.8% NET INVESTMENT INCOME TAX

Roth Solo 401k

The Patient Protection and Affordable Care Act (PPACA) added 3.8% Net Investment Income Tax to the Internal Revenue Code. The tax applies to net investment income of individuals with income higher than the below listed threshold amounts.

The final regulations generally apply to tax years beginning after December 31, 2013 to Individuals if they have net investment income and their modified adjusted gross income exceeds the thresholds:

Filing status	Threshold amount
Married filing jointly with dependent child	$250,000
Married filing separately	$125,000
Single/head of household	$200,000

For individuals whose modified adjusted gross income exceeds the thresholds, the Net Investment Income Tax applies to the lesser of:

1.    The amount by which modified adjusted gross income exceeds the threshold in the table above

or

2.    The amount of net investment income

Net investment income is generally the sum of the income items below, reduced by expenses allocable to the income:

1.  Gross income from interest, dividends, royalties and rents, except to the extent such income is excluded under the ordinary course of a trade or business exception

 
2.    Passive income from some trades or businesses, including those trading financial instruments or commodities
 
3.    Net capital gains attributable to the disposition of property.
 

   
The Roth Solo 401k plan can provide the exemptions from the tax as:

the following are not subject to the Net Investment Income Tax:

·         Dividends on employer stock distributed to participants under Section 404(k)

·         Amounts treated as distributed for tax purposes, such as a Roth IRA conversion

·         Rollovers to an IRA or another qualified plan

·         Corrective distributions from a qualified plan or arrangement necessary to maintain its tax-favored status

·         Net unrealized appreciation attributable to employer securities that is realized on the later sale of the employer securities

·         Amounts taxed as wages

Roth Solo 401k distributions are not includable in income so they will not increase modified adjusted gross income.

Check with your Accountant or CPA and avoid the Surprise!!

Solo 401k Plan: Your Opportunity for Checkbook Control of Your Future

(Information provided as an informational service and not to be construed as tax or legal advice) 

Looking for Tax Forms?- Here is the List and Due Dates

Solo 401k

Tax Statement Mailing Deadlines

Statement name	Accounts	IRS mailing deadline
Tax Reporting Statement (Includes 1099-DIV, 1099-INT, 1099-OID, 1099-B, 1099-MISC)	Nonretirement brokerage account, including Cash Management Account. S-Corps that sold a covered security will receive both a 1099-B and an Informational Tax Statement.	February 18
Tax Reporting Statement (may include Form 1099-DIV and /or 1099-B)	Nonretirement Mutual Funds Account. S-Corps that sold a covered security will receive both a 1099-B and an Informational Tax Statement.	February 18
5498	IRA	January 31
5498	IRA, if you made a contribution for the 2013 tax year between January 1, 2014, and April 15, 2014	June 2
1099-R	Retirement account (reports distributions, recharacterizations, etc.)	January 31
5498-SA	Health Savings Account	January 31
5498-SA	Health Savings Account, if you made a contribution between January 1, 2014, and April 15, 2014	June 2
1099-SA	Health Savings Account (reports distributions)	January 31
1099-Q	529 plan account distributions	January 31
1099-OID	Nonretirement brokerage account holding certain real estate mortgage investment conduits (REMICs), financial asset securitization investment trusts (FASITs), and/or collateralized mortgage obligations (CMOs)	March 17
2439	Brokerage or mutual fund account holding a mutual fund or real estate investment trust that retained its long-term capital gains	March 17
Supplemental mortgage pool statement	Accounts holding a mortgage pool security (a kind of widely held fixed investment trust) with 2013 tax-reporting consequences	March 17
1042-S	Accounts held by a nonresident alien with U.S.-source income earnings	March 17

Solo 401k Plan: Checkbook Control of Your Future

Federal Regulators Caution on Rollover from 401k to IRA

Solo 401k Plan

U.S. securities regulators are examining what happens when investors roll their 401k balances into an IRA based on the advice of a broker.

The Financial Industry Regulatory Authority and the U.S. Securities and Exchange Commission are challenging broker practices for advising clients about these so-called rollovers.

Brokers should recommend a rollover only after thinking about several factors for the investor, such as low-cost funds available through some 401(k) plans and differences in fees between the two types of accounts. 

Solo 401k Plan: Checkbook Control of Your Future

IRS Permits In-Plan Roth Rollovers.

Solo 401k Plan

If you think you will be in a higher tax bracket in retirement, you might want to consider this Roth conversion opportunity .

IRS now permits participants that make Roth elective deferral contributions to make an in-plan Roth rollover of any vested amount.

The IRS cautions that participants will be required to pay income tax on the full amount.

You may also need to increase your tax withholding from other income sources outside of the plan or make estimated tax payments to avoid an underpayment penalty.

 IRS Notice 2013-74

Solo 401k Plan: Your Opportunity for Checkbook Control of Your Future

Same-Sex couples can now Participate as Married in a Solo-k Plan

Solo-k Plan

 Same-sex partners can now participate in Solo-k plans as spouses





Guidance from the U.S. Department of the Treasury, the Internal Revenue Service and the Department of Labor has clarified that same-sex couples legally married in a jurisdiction with laws permitting same-sex marriage will be treated as married for federal tax purposes, regardless of whether the couple resides in a state where same-sex marriage is recognized.

The Supreme Court’s decided to strike down the Defense of Marriage Act making all same-sex couples the same as opposite-sex spouses for any federally administered benefits.

United States v. Windsor

Get Your Powerful Opportunities with a Solo-k Plan

Earnings increased for Social Security Tax

Solo-k Plan

 

 

The Social Security Administration announced that the maximum amount of earnings subject to the Social Security payroll tax for 2014 will increase to $117,000 from $113,700, beginning Jan. 1.

About 10 million workers will pay a higher amount as a result of the  increase in wages subject to Social Security withholding .

Solo 401k Plan:Checkbook Control of Your Future