Sep VS Solo 401k

[TAX]

Client has 401 k with his employer

Soon he will work for the same company as a consultant. Form his own scrop.
Move 401k into scorp.

Move other real property into scorp

To invest 401k money for realestate

Which one is better self directd ira vs. 401k

Thanks

[Bees Knees]

It depends on what the client wants. A SEP-IRA is limited to 25% of W-2 wages. A safe harber 401(k) can go 25% of wages PLUS elective deferrals. There is an example in TTB page 13-19 where the combination of the two makes it about two-thirds of total earnings. The draw back is the 401(k) will cost money to administer and has more restrictions than a SEP IRA.

[Unregistered]

It depends on what the client wants. A SEP-IRA is limited to 25% of W-2 wages. A safe harber 401(k) can go 25% of wages PLUS elective deferrals. There is an example in TTB page 13-19 where the combination of the two makes it about two-thirds of total earnings. The draw back is the 401(k) will cost money to administer and has more restrictions than a SEP IRA.

Thanks.
What is self directed IRA? I heard that it is usually for realestate property

[Bees Knees]

The term "self directed IRA" simply means that the participant self directs or makes the decisions on what investment to invest in. In contrast, a participant in a 401(k) is limited to the choices the employer offers through the 401(k). For example, a 401(k) may allow participants to choose any fund offered by Franklin, which offers a wide variety of mutual funds. But the participant can only stay within the Franklin family of funds. In contrast, the IRA participant decides whether to go with Franklin, or Putnam, or John Hancock, or a CD at his or her local bank. The IRA participant can also roll funds over into another IRA or employer plan at anytime, whereas the 401(k) participant is stuck in the employer's plan until he or she leaves the job.

[Armando Beaujolais]

Client has 401 k with his employer

Soon he will work for the same company as a consultant. Form his own scrop.
Move 401k into scorp.

Move other real property into scorp

To invest 401k money for realestate

Which one is better self directd ira vs. 401k

Thanks

Is this one of those deals where the 401k money is "rolled over" to another employer's plan (100% owned by the beneficiary), but in reality the money is used to capitalize the corporation or used for operating expenses?