Search found 266 matches

by dublin
Sat Apr 30, 2022 8:20 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

This is new. When I applied last year, in the Part C. Nondeductible Employee Contributions in the Instructions for Completing Adoption Agreement, it said "Indicate whether or not you will permit Employees to make non-deductible (after-tax) contributions." It was a PDF but they didn't use Docusign back then (or at least Docusign wasn't required / I don't remember seeing a Docusign option; I filled out the PDF and then actually faxed it to Etrade because I had trouble using their document upload tool). There was no box that was preselected, so I chose the "Yes" box. I would like to talk with Etrade to understand the change and its implications for folks like myself who opened up an after tax account last year. If anyone e...
by dublin
Fri Apr 01, 2022 9:20 am
Forum: Investing - Theory, News & General
Topic: HEDGEFUNDIE's excellent adventure Part II: The next journey
Replies: 14356
Views: 1989209

Re: HEDGEFUNDIE's excellent adventure Part II: The next journey

Rebalance day! Will be a big add to $TMF today. Yes I’m sure for many including me. Even thought HFEA is much talked about it’s still a small amount of the dollars in TMF (or so I think) but would be interesting if the tmf price goes down today with all the rebalancing into it. If not that confirms that there aren’t many assets using this strategy with rebalancing on April 1. So far down 4% so maybe that’s all the HFEA like me rebalancing early in the day) Market cap of TMF is $1.5B. Not enough people in HFEA, and certainly not enough that are rebalancing on the first of every quarter to make any kind of dent in it. UPRO is about 1.5b. TMF is about 0.15b. But don't the structure of these funds make them sort of immune to buying activity an...
by dublin
Tue Mar 29, 2022 10:19 am
Forum: Investing - Theory, News & General
Topic: HEDGEFUNDIE's excellent adventure Part II: The next journey
Replies: 14356
Views: 1989209

Re: HEDGEFUNDIE's excellent adventure Part II: The next journey

You know, it's hilarious that bogleheads constantly repeat the "just DCA and chill", mantra but don't do it for HFEA. I understand there's leverage which is a whole can of worms but regular VTI/VT has its own cans of worms that bogleheads just go "eh who cares, just DCA and chill", but yet for HFEA they're debating on whether or not it's still worth it due to what, a couple few bad months? Seriously now, I thought we were better than this. "this time is different!!" Yeah, thats what they always say. a true boglehead would just DCA into VTI/VT/HFEA and buy more. I don't even quite understand the concerns. either HFEA is your play money and you don't care either way, or it's up to your risk tolerance and is 90-1...
by dublin
Mon Mar 28, 2022 12:57 pm
Forum: Personal Finance (Not Investing)
Topic: Solo 401k, Plan Administrator EIN question
Replies: 8
Views: 808

Re: Solo 401k, Plan Administrator EIN question

mcnulty wrote: Mon Mar 28, 2022 11:49 am Would you mind sharing how you resolved this? For Plan Administrator, did you just write "Same" and not enter an EIN? I am in a similar position and wondering how to fill out this section on my 5500 EZ. Thank you.
I ended up putting my name on line 3a ("John Smith"), with the same EIN in 3b as I had in 2b. 2a was the name of my LLC.
by dublin
Mon Mar 28, 2022 7:56 am
Forum: Investing - Theory, News & General
Topic: HEDGEFUNDIE's excellent adventure Part II: The next journey
Replies: 14356
Views: 1989209

Re: HEDGEFUNDIE's excellent adventure Part II: The next journey

taojaxx wrote: Mon Mar 28, 2022 7:35 am Yield curve (10 minus 2) is barely positive: at 18bp, it is close to the flatter it has been over the last 40 years or so.

For the Fed to embark on a tightening cycle is such an environment makes for an interesting experience.
It really IS different this time: Feels like the 40 year Bond bash has finally come to a close.
What it means for HFEA is anybody's guess. I personally dropped TMF a while back (started cutting it down end 2021). No shortage of alternate hedges if you use futures: DX, GC, short ES. It's just not a set it and forget it thingy.
"This time is different"
by dublin
Sat Mar 26, 2022 8:26 pm
Forum: Personal Investments
Topic: Conflicting Info for Max After-tax Solo 401k Contribution?
Replies: 4
Views: 1263

Re: Conflicting Info for Max After-tax Solo 401k Contribution?

The actual language in the Wiki is quite different than what I originally proposed, but it is technically correct. Yours may be clearer, but people may still not realize that the employer contribution also reduces compensation. To clarify: As I already stated, the $56K/$57k limit and the 100% compensation limit are both 415c limits. This discussion has neglected an additional piece of information. 403b annual additions must be aggregated with the annual additions of any business owned > 50% by the 403b participant. The complete maximum self-employed employee after-tax contribution is the lessor of: The statutory limit (2019 = $56K, 2020 = $57K) - 403b (employee + employer) contributions - employee deferrals - employer contributions. Busine...
by dublin
Thu Mar 24, 2022 12:42 pm
Forum: Investing - Theory, News & General
Topic: HEDGEFUNDIE's excellent adventure Part II: The next journey
Replies: 14356
Views: 1989209

Re: HEDGEFUNDIE's excellent adventure Part II: The next journey

Sticking through a strategy after you have planned it out is way more important than anything else. If the strategy is sound, yes. That's the big question right now as 2022 is potentially a repeat of 1973. Things tend to get over technical here. Which can be fun. But also alarmist when the market shits the bed. All HFEA is is a 60/40 portfolio with leverage. So if the 60/40 portfolio is a sound strategy so is HFEA. It's very simple. That is why I like it. Also, I don't like to type a lot so here are some of the pros and cons of a 60/40 portfolio written by somebody else. At any rate, the last few months in this thread has been an excellent adventure in human psychology. https://robberger.com/60-40-portfolio/ It's not simple at all because ...
by dublin
Tue Mar 22, 2022 1:36 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

Iteb wrote: Tue Mar 22, 2022 2:48 am Thank you for your response. Looks like I need to open another solo 401k focus on those nondeductible employee contributions for 2022.

I appreciate your time answering my questions. It seems like a topic not many people know about.
Glad I could help! Not the easiest thing to sort out, agreed.
by dublin
Mon Mar 21, 2022 11:00 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

Thanks for the reply. I set up the Roth 401k at the same time I set up the Solo 401k and contributed the full amount to the employee side. Would I still be about to make the employee nondeductible contributions on the Solo account for 2021. I’ve been having a hell of a trying to find a CPA that knows anything about this. I appreciate your response! First of all, just to be clear, in addition to the regular Traditional and Roth 401k accounts, you'll also need a separate Traditional 401k account for the non-deductible/after-tax employee contributions. In E-trade's eyes this will simply be a second/duplicate Traditional 401k account. This may or may not cause some confusion when you're opening it. To your question - technically, you can make ...
by dublin
Mon Mar 21, 2022 5:25 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

Iteb wrote: Mon Mar 21, 2022 5:20 pm Would you need a TPA or plan documents if you have a ETrade Solo 401k account then?

I tried another CPA that is also a CFP and he was saying that I can’t contribute after tax dollars because I’m sole proprietor, but I’m wonder if that’s accurate? I’m seeing all these TPA that offer that option to sole proprietors.
No. DIY works.
by dublin
Sat Mar 12, 2022 9:58 pm
Forum: Personal Finance (Not Investing)
Topic: Backdoor Roth in Massachusetts
Replies: 15
Views: 3275

Re: Backdoor Roth in Massachusetts

I've done the backdoor Roth for the last few years. I've used TurboTax online for the last few years too. In 2019 and 2020, TurboTax counted the $6000 as part of my taxable income. It appears on line 2 of Schedule X: "Taxable IRA/Keogh and Roth IRA conversion distributions." That ends up appearing on line 9 of Form 1: "Other income from Schedule X, line 5." I didn't notice this until now, because... For 2021, we did a backdoor Roth for my wife for the first time. We first opened a self-employed 401(k) for her, rolled everything except the basis over to the 401(k), and then converted the basis. TurboTax was saying we owed a couple thousand in state taxes for her conversion, which was big enough for me to notice. In the s...
by dublin
Sat Mar 12, 2022 8:26 pm
Forum: Personal Investments
Topic: Emergency Fund
Replies: 22
Views: 2358

Re: Emergency Fund

Vtsax100 wrote: Sat Mar 12, 2022 8:42 am Not only is this reckless, you can most likely never retire.
Time for OP to consider driving for Uber to beef up savings rate.
by dublin
Fri Feb 11, 2022 9:33 am
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

Yeah, happy to report that based on my experience, the rep you spoke with was incorrect regarding the 1099-R. On my 1099-R, box 1 shows the full amount of my non-deductible contribution (which I immediately rolled over to the Roth sub-account, with no earnings on top of the contributed amount), box 2a shows a taxable amount of $0.00 (which is correct), and box 2b is NOT checked (meaning the taxable amount IS determined). The only other item on the 1099-R is box 7, which has the correct code of 'G'. So yes, looks like they nailed it. Thanks. I see there is some question about Box 5 but I'm still hung up on the taxable amount calculation. I called Etrade today and for the second time they insisted that they do not calculate a taxable amount....
by dublin
Thu Feb 10, 2022 11:45 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

Yeah, happy to report that based on my experience, the rep you spoke with was incorrect regarding the 1099-R. On my 1099-R, box 1 shows the full amount of my non-deductible contribution (which I immediately rolled over to the Roth sub-account, with no earnings on top of the contributed amount), box 2a shows a taxable amount of $0.00 (which is correct), and box 2b is NOT checked (meaning the taxable amount IS determined). The only other item on the 1099-R is box 7, which has the correct code of 'G'. So yes, looks like they nailed it. Thanks. I see there is some question about Box 5 but I'm still hung up on the taxable amount calculation. I called Etrade today and for the second time they insisted that they do not calculate a taxable amount....
by dublin
Tue Feb 08, 2022 10:04 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

Yeah, happy to report that based on my experience, the rep you spoke with was incorrect regarding the 1099-R. On my 1099-R, box 1 shows the full amount of my non-deductible contribution (which I immediately rolled over to the Roth sub-account, with no earnings on top of the contributed amount), box 2a shows a taxable amount of $0.00 (which is correct), and box 2b is NOT checked (meaning the taxable amount IS determined). The only other item on the 1099-R is box 7, which has the correct code of 'G'. So yes, looks like they nailed it. I spoke a bit too soon :oops: A forum member DMed me to let me know that E-Trade missed one thing - they left box 5 blank, whereas it should have shown the same amount as box 1. I called E-Trade to ask for a co...
by dublin
Tue Feb 08, 2022 9:42 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

Yeah, happy to report that based on my experience, the rep you spoke with was incorrect regarding the 1099-R. On my 1099-R, box 1 shows the full amount of my non-deductible contribution (which I immediately rolled over to the Roth sub-account, with no earnings on top of the contributed amount), box 2a shows a taxable amount of $0.00 (which is correct), and box 2b is NOT checked (meaning the taxable amount IS determined). The only other item on the 1099-R is box 7, which has the correct code of 'G'. So yes, looks like they nailed it. I spoke a bit too soon :oops: A forum member DMed me to let me know that E-Trade missed one thing - they left box 5 blank, whereas it should have shown the same amount as box 1. I called E-Trade to ask for a co...
by dublin
Tue Feb 08, 2022 9:28 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

Yeah, happy to report that based on my experience, the rep you spoke with was incorrect regarding the 1099-R. On my 1099-R, box 1 shows the full amount of my non-deductible contribution (which I immediately rolled over to the Roth sub-account, with no earnings on top of the contributed amount), box 2a shows a taxable amount of $0.00 (which is correct), and box 2b is NOT checked (meaning the taxable amount IS determined). The only other item on the 1099-R is box 7, which has the correct code of 'G'. So yes, looks like they nailed it. I spoke a bit too soon :oops: A forum member DMed me to let me know that E-Trade missed one thing - they left box 5 blank, whereas it should have shown the same amount as box 1. I called E-Trade to ask for a co...
by dublin
Sun Jan 30, 2022 8:54 am
Forum: Investing - Theory, News & General
Topic: HEDGEFUNDIE's excellent adventure Part II: The next journey
Replies: 14356
Views: 1989209

Re: HEDGEFUNDIE's excellent adventure Part II: The next journey

oldnewb wrote: Thu Jan 27, 2022 11:51 pm I wonder how Hedgefundie portfolio is doing these days?
Super duper well for those of us who started mid-day last Monday!
by dublin
Wed Jan 26, 2022 3:17 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

Thank you @aray, @dublin. MBDR here I come! Awesome - the last piece of advice I'd give you is that it took me a number of phone calls over a couple of weeks to get all of the new accounts properly squared away at Etrade, connected to my existing Etrade login, etc - so don't be dissuaded if it's a bit of a bumpy ride getting everything set up! Now that it's done, it's smooth as butter, and the Etrade reps I've chatted with along the way have been stellar - knowledgeable and helpful, and happy to follow up. Good luck, and welcome to the club! Since I already have an individual 401k with Etrade, I am very interested in the MBD Roth possibility, but I'm a little confused by the IN-PLAN ROTH ROLLOVERS section (3.09) of the Etrade plan descript...
by dublin
Fri Jan 21, 2022 1:13 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

Thank you @aray, @dublin. MBDR here I come! Awesome - the last piece of advice I'd give you is that it took me a number of phone calls over a couple of weeks to get all of the new accounts properly squared away at Etrade, connected to my existing Etrade login, etc - so don't be dissuaded if it's a bit of a bumpy ride getting everything set up! Now that it's done, it's smooth as butter, and the Etrade reps I've chatted with along the way have been stellar - knowledgeable and helpful, and happy to follow up. Good luck, and welcome to the club! Since I already have an individual 401k with Etrade, I am very interested in the MBD Roth possibility, but I'm a little confused by the IN-PLAN ROTH ROLLOVERS section (3.09) of the Etrade plan descript...
by dublin
Wed Dec 22, 2021 8:43 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

tay wrote: Wed Dec 22, 2021 8:36 pm Thank you @aray, @dublin. MBDR here I come!
Awesome - the last piece of advice I'd give you is that it took me a number of phone calls over a couple of weeks to get all of the new accounts properly squared away at Etrade, connected to my existing Etrade login, etc - so don't be dissuaded if it's a bit of a bumpy ride getting everything set up! Now that it's done, it's smooth as butter, and the Etrade reps I've chatted with along the way have been stellar - knowledgeable and helpful, and happy to follow up.

Good luck, and welcome to the club!
by dublin
Wed Dec 22, 2021 8:29 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

tay wrote: Wed Dec 22, 2021 6:38 pm Thank you for confirming my understanding. Anything else I might be missing that prevents me from entirely max'ing out $58k thru NDEC to maximize MBDR? Once again, our situation is 1) single-member LLC, 2) no W-2 wage (ie, filing as Sched C), 3) over $150k business profit
As far as I can tell, no, based on the circumstances you described there would be nothing stopping you from putting in the full $58k as NDEC.
by dublin
Wed Dec 22, 2021 5:53 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

Regarding EIN @aray @dublin, or anyone who has a solo 401k When you opened the solo 401k, did you get a separate EIN and use that instead of your company's EIN in the account application? I'm reading these that seem to say we definitely should: https://www.irs.gov/retirement-plans/how-to-obtain-or-re-establish-an-ein-for-a-retirement-plan-trust https://www.mysolo401k.net/solo-401k/ein-number/ Why does my solo 401k plan require a separate EIN? ANSWER: The 401k needs to have a separate EIN from your self-employed business or SSN. This is clear based on the IRS guidance and because the 401k is a retirement trust which is distinct from the Corporation (i.e. the account that will be set up at Fidelity for the 401k will not be an account for you...
by dublin
Wed Dec 22, 2021 2:51 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

I just spoke to a financial advisor, and she says we must max out the $19.5k PRE-TAX employee contribution first. And it has to be pre-tax 401k, not Roth 401k. This is contrary to what I've read that the EE contribution can be pre-tax or Roth, as both are supported by ETrade solo 401k. Which is right? This is incorrect. You do not have to make any Traditional or Roth EE contributions before you can make after-tax contributions. - definitely can have a 2nd indiv. 401k account for NDEC. They think it's a good idea too, but not going as far as recommending it. Just need to fill out a separate account application selecting Indiv 401k and using the same plan name and seq number. - confirmed that they're coding all employee contribution before J...
by dublin
Wed Dec 22, 2021 12:07 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

1) aray, is there any reason/benefit that you're not rolling the Nondeductible Employee Contribution (NDEC) amount into a Roth IRA, which I thought is more flexible than Roth 401k? For me, in addition to the reasons aray mentioned, one other reason to stick with the Roth 401k is that in the (relatively unlikely, but possible) event that I want to invest in leveraged real estate in the future, a Roth 401k avoids the UBIT/UDFI issues that a Roth IRA faces. Also, I don't really have any reason to favor the Roth IRA in this case, since with a Solo Roth 401k, I can basically invest in anything I want anyway and don't pay any fees (unlike an employer Roth 401k where you might have more limited investment options, or fees). 3) what's the deadline...
by dublin
Wed Dec 22, 2021 12:03 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

aray wrote: Mon Dec 20, 2021 5:11 pm
Congratulations on persevering and finding a way to use the mainstream E*Trade Solo 401k plan for a mega backdoor Roth!

Please update after you receive your tax forms to let us know if E*Trade got the tax reporting correct.
Thank you, and sure I'll aim to follow up on Etrade's tax form once that comes out!
Just completed my first Solo 40k1 In-Plan-Roth-Rollover at Etrade, after funding the after-tax account in one-business-day online transfers using both their website and my bank's bill-pay utility - many thanks to you!
by dublin
Sat Dec 11, 2021 4:49 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

aray wrote: Sat Dec 11, 2021 6:11 am Sorry, I just saw your message - yes, I made a contribution to the new after tax account within my Etrade Solo 401k and immediately did an in plan Roth rollover of those funds.
Amazing! I just finished getting my accounts set up this past week, and will be taking contributions for a spin this coming week, just in time before the option is possibly removed on Jan 1!
by dublin
Mon Nov 01, 2021 9:13 am
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

aray wrote: Thu Sep 23, 2021 5:00 pm As a quick update, I submitted my application yesterday to Etrade to establish the 3rd account to be used for after tax employee contributions, and it was approved and opened today! I now have three solo 401k accounts at Etrade, all under the same plan name and sequence number, and all accessible with the same user login profile:
1) Roth 401k
2) Pre-tax 401k
3) After tax 401k
Hey there - thought I'd bump this thread a month later and see if you've had success with the MBDR with your new accounts!

I've been muddling my way through the application/amendment form for a month now since a few things are murky to me, but if you're having success with the MBDR that would be great motivation! :beer
by dublin
Tue Oct 05, 2021 11:47 am
Forum: Personal Investments
Topic: Amending (Transferring) Solo 401k - Effective Date For Amendment?
Replies: 5
Views: 689

Re: Amending (Transferring) Solo 401k - Effective Date For Amendment?

pkcrafter wrote: Tue Oct 05, 2021 11:24 am Maybe something here will help...

https://www.mysolo401k.net/top-reasons- ... solo-401k/



Paul
I appreciate the link, but unfortunately it doesn't answer the question at hand.
by dublin
Tue Oct 05, 2021 10:44 am
Forum: Personal Investments
Topic: Amending (Transferring) Solo 401k - Effective Date For Amendment?
Replies: 5
Views: 689

Re: Amending (Transferring) Solo 401k - Effective Date For Amendment?

Hello, I'm planning to transfer my existing Solo 401k from Fidelity to Etrade by amending the plan. Thus far in 2021 I have made a number of contributions to the plan (at Fidelity) I'm trying to determine what the 'effective date' for the amendment should be. If I were to make the effective date 1/1/21, as an Etrade rep suggested, would that create issues considering that I have already made various contributions throughout 2021 YTD under the original Fidelity plan document? Can I simply make the amendment effective date on the day I submit it, 10/4/21 for example if I were submitting it today? Thank you for any input - this question has been surprisingly difficult to get a clear answer on. You might get some replies if you explain a bit m...
by dublin
Mon Oct 04, 2021 11:12 pm
Forum: Personal Investments
Topic: Amending (Transferring) Solo 401k - Effective Date For Amendment?
Replies: 5
Views: 689

Amending (Transferring) Solo 401k - Effective Date For Amendment?

Hello,

I'm planning to transfer my existing Solo 401k from Fidelity to Etrade by amending the plan.

Thus far in 2021 I have made a number of contributions to the plan (at Fidelity)

I'm trying to determine what the 'effective date' for the amendment should be.

If I were to make the effective date 1/1/21, as an Etrade rep suggested, would that create issues considering that I have already made various contributions throughout 2021 YTD under the original Fidelity plan document?

Can I simply make the amendment effective date on the day I submit it, 10/4/21 for example if I were submitting it today?

Thank you for any input - this question has been surprisingly difficult to get a clear answer on.
by dublin
Mon Oct 04, 2021 10:23 pm
Forum: Personal Finance (Not Investing)
Topic: Solo401k transfer
Replies: 18
Views: 2357

Re: Solo401k transfer

When you say a business is not allowed to have 2 401Ks, do you mean even if one of them has zero assets in it? I'm not @cowdogman, but the balance in the plans are not relevant. For all practical purposes, having two one-participant 401k plans is a serious 401k compliance error When you change one-participant 401k plan providers, the correct process is to: Use the amendment section of the new provider's adoption agreement to amend the 401k plan. The fact is that it is still the same 401k plan. Open 401k account(s) at the new provider. Do a trustee -> trustee transfer. Notify the old provider to close the old account (s). I'm looking back in the TD documents and looks like they checked the box as new plan - but with an effective date of 12/...
by dublin
Mon Sep 27, 2021 11:38 am
Forum: Personal Investments
Topic: Amend Solo 401k To Allow After-Tax Contribution - Can I Still Make 2020 Contributions?
Replies: 0
Views: 657

Amend Solo 401k To Allow After-Tax Contribution - Can I Still Make 2020 Contributions?

Hello,

I have an existing Solo 401k plan that has been open for several years at Fidelity, which does not allow after-tax contributions.

I am planning to move the plan over to E-trade, which does allow after-tax contributions.

I know that my deadline for making 2020 employer and employee contributions is Oct 15 (since I extended my tax return).

Question - if I make this amendment today, would I also be allowed to make 2020 after-tax contributions until Oct 15?

Related question - should the Effective Date for my amendment of my plan adoption agreement be, say Oct 1? Or should it be Jan 1 2021, as Etrade is suggesting? Is it ok to make it Jan 1 2021 even though I've been making contributions all year so far in this account at Fidelity?
by dublin
Thu Sep 23, 2021 5:17 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

aray wrote: Thu Sep 23, 2021 5:00 pm As a quick update, I submitted my application yesterday to Etrade to establish the 3rd account to be used for after tax employee contributions, and it was approved and opened today! I now have three solo 401k accounts at Etrade, all under the same plan name and sequence number, and all accessible with the same user login profile:
1) Roth 401k
2) Pre-tax 401k
3) After tax 401k
That's an awesome update - thanks!
by dublin
Sun Sep 19, 2021 11:34 pm
Forum: Personal Investments
Topic: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k
Replies: 144
Views: 18764

Re: After Tax Contributions / Mega Backdoor Roth - Etrade Solo 401k

As an update, I've consulted with a CPA who has 10+ years experience, who has advised me of the following: The after tax (non Roth) contributions can be made directly to the traditional 401k account. I can then immediately do the in plan Roth rollover to move these funds to the Roth 401k account. A separate account can be used for the after-tax (non Roth) contributions, but that's not required. If I'd prefer to open a 3rd account to exclusively hold the after tax contributions, the CPA says this will also be fine and it's up to me. For the Roth 401k account, I don't need separate accounts for Roth 401k elective deferral contributions and amounts rolled over or converted to the Roth 401k. These amounts can be commingled. As far as tax repor...
by dublin
Sat Aug 14, 2021 11:19 pm
Forum: Personal Investments
Topic: TD Ameritrade or E*Trade for Individual 401k
Replies: 15
Views: 1985

Re: TD Ameritrade or E*Trade for Individual 401k

I'm planning to move mine from Fidelity to Etrade, so check back with me in a few months :)

I chose Etrade for the reasons above, and also because unlike Fidelity and others, they allow electronic contributions to the solo 401k, as well as ACH pushes. Oh, and they have a nice bonus offer at the moment.
by dublin
Tue Aug 10, 2021 8:43 am
Forum: Personal Investments
Topic: Waiting period between buying/selling ETF/MF?
Replies: 11
Views: 2476

Re: Waiting period between buying/selling ETF/MF?

I know this question was for Schwab, but I tried this on Vanguard and wanted to report in case someone asks the question in the future. I wanted to exchange Vanguard Total Bond Mutual Fund shares into ETF shares. To do this, I placed an order to sell the MF shares. This executed at closing and the funds were available the next day. I could then purchase the ETF shares. So there's a day wait if you want to sell MF to buy ETF. There is no need to wait a day at Vanguard. In fact, you can place the ETF purchase before you place the sale of Total Bond and then place the mutual fund sell order for the exact amount you need. I do this all the time to rebalance from bond mutual funds to equity ETFs. ETFs settle T+2, while mutual funds settle T+1, ...
by dublin
Thu Aug 05, 2021 9:50 am
Forum: Personal Investments
Topic: Move Solo 401k From Fidelity Funds To Etrade Vanguard Funds - Without Fees Or Time Out Of Market?
Replies: 8
Views: 990

Re: Move Solo 401k From Fidelity Funds To Etrade Vanguard Funds - Without Fees Or Time Out Of Market?

Hi, I currently have a Solo 401k at Fidelity - with accounts for myself and my spouse. It is invested (for each of us) in FTIHX and FSKAX. I'd like to move the plan to etrade, and ultimately invest in VTIAX and VTSAX instead. How can I get from A to B without either paying fees or spending time out of the market? My first thought was transfer in kind, but etrade charges trading fees on FTIHX and FSKAX. Then i thought of selling the fidelity funds and buying VTI/VXUS to transfer, but then my money would be uninvested post-sale pre-ETF purchase. Any advice would be appreciated! Those 4 funds are basically the same. (The Fidelity funds have slightly lower expense ratios.) Why do you want to switch out? Is it just for the no-transaction-fee pu...
by dublin
Thu Aug 05, 2021 9:48 am
Forum: Personal Investments
Topic: Move Solo 401k From Fidelity Funds To Etrade Vanguard Funds - Without Fees Or Time Out Of Market?
Replies: 8
Views: 990

Re: Move Solo 401k From Fidelity Funds To Etrade Vanguard Funds - Without Fees Or Time Out Of Market?

Then finally, I can sell the ETFs at Etrade and buy VTSAX/VTIAX, using the same 10% or 25% at a time approach to diversify the 'time out of market' risk. (Etrade can't magically convert VTI into VTSAX, can they?) Does that seem like a reasonable plan? You'd have to sell VTI and then buy VTSAX; Etrade can't magically convert it. Neither can Vanguard for that matter -- the share class conversion Vanguard offers is one-way only, from mutual fund to ETF. That plan is reasonable, though Laundry Service's suggestion below may be simplest. I'm not sure if Etrade will charge you a fee to sell your fidelity funds after they are at etrade. Why not transfer your current funds in kind to etrade and purchase Vanguard funds with your new contributions? ...
by dublin
Thu Aug 05, 2021 1:06 am
Forum: Personal Investments
Topic: Move Solo 401k From Fidelity Funds To Etrade Vanguard Funds - Without Fees Or Time Out Of Market?
Replies: 8
Views: 990

Re: Move Solo 401k From Fidelity Funds To Etrade Vanguard Funds - Without Fees Or Time Out Of Market?

Laundry_Service wrote: Wed Aug 04, 2021 8:23 pm I'm not sure if Etrade will charge you a fee to sell your fidelity funds after they are at etrade. Why not transfer your current funds in kind to etrade and purchase Vanguard funds with your new contributions? Depending on the size of your account to be transferred Etrade may also be willing to give you a bonus and/or reimburse you for any comssions to sell.
That's a good idea. I did confirm that etrade charges $19.99 per transaction to buy or sell a mutual fund unless it's in their no fer collection. But it's certainly worth asking if they'd waive/reimburse that if I bring the account over. And yes, they do have a nice bonus at the moment too.
by dublin
Wed Aug 04, 2021 8:01 pm
Forum: Personal Investments
Topic: Move Solo 401k From Fidelity Funds To Etrade Vanguard Funds - Without Fees Or Time Out Of Market?
Replies: 8
Views: 990

Re: Move Solo 401k From Fidelity Funds To Etrade Vanguard Funds - Without Fees Or Time Out Of Market?

I have no experience with 401k-to-401k transfers, but I would check if both custodians support doing in-kind transfers. Does you 401k plan at Fidelity allow you to invest in ETFs? And does the 401k plan at ETrade let you invest in ETFs? And in-kind transfers are supported? If yes to all questions, that'd be the way to go as you can avoid the question of fees on trading. The only catch is being out of the market. Do you have any other retirement accounts like an IRA? One common approach for 401k-to-IRA transfers is to (1) sell the stock fund in the 401k and (2) on the same day exchange the same amount from a bond fund to a stock fund in the other account. That way, you're essentially swapping bonds to cash but your stock allocation remains ...
by dublin
Wed Aug 04, 2021 5:43 pm
Forum: Personal Investments
Topic: Move Solo 401k From Fidelity Funds To Etrade Vanguard Funds - Without Fees Or Time Out Of Market?
Replies: 8
Views: 990

Move Solo 401k From Fidelity Funds To Etrade Vanguard Funds - Without Fees Or Time Out Of Market?

Hi,

I currently have a Solo 401k at Fidelity - with accounts for myself and my spouse. It is invested (for each of us) in FTIHX and FSKAX.

I'd like to move the plan to etrade, and ultimately invest in VTIAX and VTSAX instead.

How can I get from A to B without either paying fees or spending time out of the market?

My first thought was transfer in kind, but etrade charges trading fees on FTIHX and FSKAX.

Then i thought of selling the fidelity funds and buying VTI/VXUS to transfer, but then my money would be uninvested post-sale pre-ETF purchase.

Any advice would be appreciated!
by dublin
Thu Jul 15, 2021 9:39 pm
Forum: Personal Finance (Not Investing)
Topic: Backdoor Roth, But Income Was Actually Below Threshold - Need 8606? 1040x?
Replies: 6
Views: 532

Re: Backdoor Roth, But Income Was Actually Below Threshold - Need 8606? 1040x?

You need to report it one way or the other. You get to decide which way since you are eligible for both. Option 1 is to take the deduction in 2020 using Sch 1 and then you will need to add that amount to your taxable income in 2021 as a result of the conversion. Option 2 is to file form 8606 electing to treat the contribution as non deductible. The taxable income from the conversion in 2021 then is reduced to zero. Based on your comment that the deduction would not be helpful in 2020, it seems like you should follow your original plan to file a standalone 8606. Awesome, thanks for elaborating and confirming MrJedi's comment! Very happy to hear that I can simply elect to treat my contribution as non-deductible and file form 8606 as original...
by dublin
Thu Jul 15, 2021 9:29 pm
Forum: Personal Finance (Not Investing)
Topic: Backdoor Roth, But Income Was Actually Below Threshold - Need 8606? 1040x?
Replies: 6
Views: 532

Re: Backdoor Roth, But Income Was Actually Below Threshold - Need 8606? 1040x?

MrJedi wrote: Thu Jul 15, 2021 9:19 pm You are not required to take the tax deduction. In your case you just opt out of deducting it, and then it becomes a nondeductible contribution.
Oh, very interesting - I didn't know that. Thanks for replying!

Just to clarify, are you saying that if I simply choose not to deduct my Traditional IRA contribution (even though it was eligible to be deducted), it is now deemed a "non-deductible contribution", and therefore I can do the normal Form 8606 process with it?

Seems odd to me since technically my contribution was deductible, it just wasn't deducted.
by dublin
Thu Jul 15, 2021 9:02 pm
Forum: Personal Finance (Not Investing)
Topic: Backdoor Roth, But Income Was Actually Below Threshold - Need 8606? 1040x?
Replies: 6
Views: 532

Backdoor Roth, But Income Was Actually Below Threshold - Need 8606? 1040x?

Hi there, A bit confused about how to handle this. Let's say I filed my 2020 1040 in March of 2021. In early April of 2021 (before the deadline), I decided to make a 2020 backdoor Roth contribution. I made a Trad IRA contribution, and then a few days later converted it to Roth. I assumed at the time that sometime later (eg now) I would file a standalone 8606 to show the nondeductible contribution. Then later, I'll file a form 8606 with my 2021 1040 (in 2022) to show the conversion. However, I just realized that due to my income in 2020, it turns out my contribution was actually deductible, not non-deductible. So that means no 8606 right now, right? Am I required to amend my 2020 1040 to show that IRA deduction on Schedule 1? As it happens, ...
by dublin
Tue Jun 08, 2021 2:36 pm
Forum: Personal Investments
Topic: Mega Backdoor Roth Contributions - Treated as regular contribution for withdrawal purposes?
Replies: 13
Views: 959

Re: Mega Backdoor Roth Contributions - Treated as regular contribution for withdrawal purposes?

So it sounds like if you only ever make backdoor and megabackdoor conversions, you can take it all out whenever you want? As long as there wasn't any growth prior to the conversion. Even if there was growth, the 10% penalty may still be worth it, since it is only on the growth. I note in my spreadsheet how much was taxed at conversion, so that we can make an informed decision should the situation ever arise. For instance, I could pay $143 penalty on my oldest MBR and it would also open up the following year entirely, as there was no growth prior to conversion in the second year. Right, that makes sense. I think I would similarly be converting either $0 or negligible amounts of growth such that a 10% penalty would be immaterial. Does all of...
by dublin
Tue Jun 08, 2021 2:13 pm
Forum: Personal Investments
Topic: Mega Backdoor Roth Contributions - Treated as regular contribution for withdrawal purposes?
Replies: 13
Views: 959

Re: Mega Backdoor Roth Contributions - Treated as regular contribution for withdrawal purposes?

So it sounds like if you only ever make backdoor and megabackdoor conversions, you can take it all out whenever you want?
by dublin
Wed Jun 02, 2021 7:33 am
Forum: Personal Finance (Not Investing)
Topic: Solo 401k, Plan Administrator EIN question
Replies: 8
Views: 808

Re: Solo 401k, Plan Administrator EIN question

BlueFin wrote: Wed Jun 02, 2021 7:26 am
valuegrowth wrote: Tue Jun 01, 2021 10:38 am BlueFin and HomeStretch, thanks for your response.

dublin, I was referring to this thread in my original post viewtopic.php?t=281461.

BlueFin, would you mind letting us know if you had the similar situation, ie, having an solo 401k adoption agreement on which a person was listed as the Plan Administrator. Fidelity told me this was required by their plan document.

Thanks for helping out!
Yes, my name was listed in the agreement as the plan administrator.
And the Employer name (and name of Plan) in Box 2 were something different, like an LLC?
by dublin
Tue Jun 01, 2021 10:18 am
Forum: Personal Finance (Not Investing)
Topic: Solo 401k, Plan Administrator EIN question
Replies: 8
Views: 808

Re: Solo 401k, Plan Administrator EIN question

I have a solo 401k at Fidelity and this is first time I have to file 5500-EZ. In Fidelity's 401k adoption agreement I have my scorp as the Employer but put my name as the Plan Administrator. I was a bit confused if I put my name as the Plan Administrator on line 3a then what is line 3b for EIN. I called Fidelity Retirement and was told they can't help me with the form. From what I read above I think I can write down the "SAME" on line 3a and leave line 3b blank as suggested above. Can anyone who has filled out this form before confirm my understanding is correct? Another question I have is if anyone has filed form 5500-EZ with EFAST2 and does it give a confirmation when filing online. Given the new increased penalty on late filin...
by dublin
Wed May 19, 2021 5:39 pm
Forum: Personal Investments
Topic: How are the "100% Stocks" people doing?
Replies: 256
Views: 41985

Re: How are the "100% Stocks" people doing?

shangrila wrote: Wed May 19, 2021 5:33 pm How can you be a Boglehead if you are 100% in equities? I will never forget Jack Bogle after the 2008 crash lecturing people about being in bonds/age in bonds specifically...... though the bond market is scary right now.
A significant portion of the recommendation to own bonds is sort of paternalistic and assumes an inability to stay the course.