Solo 401k Setup Expense – Small Business Retirement Plan
To set up a Solo 401k plan, many small business owners ask about the setup expenses. Who is responsible for the fees and is it tax-deductible? Sense Financial discusses Solo 401k setup expenses in this Solo 401k Quick Tip video.
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The establishment cost is the responsibility of the plan sponsor or the employer. In the case of a Solo401k, you are the employer in the business. Therefore, you are responsible for the Solo401k establishment cost. It should be paid for from your personal or business account. You cannot use your retirement funds to pay for the establishment cost. Typically this can be a deductible business expense. Check with your accountant to see if it can be claimed as a deduction for your business.