What is the difference between a Solo 401k and a "Regular" 401k with one participant?

[DebitThatCreditThis]

In my search for a solo 401k, regular 401k, and SEP administrator, I just wrapped up a demo with Guideline.com (401k/SEP TPA). Liking the integration with Gusto.

Only downside: They don't offer Solo 401k plans =/

The rep said they have plenty of clients as the only participant in "regular" 401k plans.

My question is, what's the difference? Does it come down to fees, testing rules, and types of investments allowed?

Hard to google my way to an answer in terms of contribution limit differences (if any), etc.

I really want a simple admin system that offers solo, regular, and SEP options and also integrates with Gusto.

I'll share the demo slides with you guys once she sends them over if anyone wants.

[TaxGuyBill]

A 'regular' 401k is fine. It will be the same thing, but be CAPABLE of handling more than one person. But it would be the same as a Solo if you only have one person.

[terryats]

Individual 401k VS. Solo 401k

Individual 401k

• Owner-only retirement plan offered by brokerage firms and insurance companies

• Only allows for investing in annuities, mutual funds and publicly traded stocks

• Does not always allow for participant loans

• Does not allow for checkbook control

Solo 401k

• Owner-only retirement plan that allows business owner to trustee, and self direct Solo 401k into alternative investments

• Can invest in alternative investments such as real estate, precious metals, tax liens, trust deeds, private shares, as well as equities (stock and mutual funds)

• Allows for Checkbook Control

• Allows for participant loans (borrow from Solo 401k)

• Can be invested in Life Insurance for business owner and his or her beneficiaries

[Rapid Robert]

"simple admin system that offers solo, regular, and SEP options and also integrates with Gusto."

Just curious why you want/neet a SEP-IRA if you have an individual 401k? The 401k offers higher contribution levels at lower salary (due to elective salary deferral), otherwise pretty equivalent, unless I'm missing something. Are you a sole prop? I surmise the desire for Gusto integration is because you are an S-corp and pay yourself a regular fixed payroll and issue W-2? I have an individual 401k, I find it's much easier to just make contributions directly (my only choice since I don't get a paycheck) whenever I have the cash to spare.

"self direct Solo 401k into alternative investments"

What is listed as "Solo" looks to me like just Individual 401k with self-direct feature added. I've always thought "solo" and "individual" were synonymous, but I only have my own experience to go by.

Just curious, what is the source of this bullet-list summary, if you did not come up with it yourself?

[DebitThatCreditThis]

"simple admin system that offers solo, regular, and SEP options and also integrates with Gusto."

Just curious why you want/neet a SEP-IRA if you have an individual 401k? The 401k offers higher contribution levels at lower salary (due to elective salary deferral), otherwise pretty equivalent, unless I'm missing something. Are you a sole prop? I surmise the desire for Gusto integration is because you are an S-corp and pay yourself a regular fixed payroll and issue W-2? I have an individual 401k, I find it's much easier to just make contributions directly (my only choice since I don't get a paycheck) whenever I have the cash to spare.

"self direct Solo 401k into alternative investments"

What is listed as "Solo" looks to me like just Individual 401k with self-direct feature added. I've always thought "solo" and "individual" were synonymous, but I only have my own experience to go by.

Just curious, what is the source of this bullet-list summary, if you did not come up with it yourself?

Good point on the Solo 401k vs SEP. I guess it would never make sense to use a SEP over a Solo 401k other than admin burden right?