When is the deadline for opening a solo 401k? Last day timing requirements?
So I'm cutting it super close here and freaking out a bit! I've been running my photography business all year and just realized I need to open a solo 401k before the year ends. Would it be ok if I managed to open a solo 401k account before midnight tonight and also initiated a transfer of funds before midnight? Or am I totally screwed at this point? Just want to make sure I'm not missing some weird timing rule since I'm literally down to the final hours. Any help appreciated!!
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Marcus Patterson
While the deadline for establishing a solo 401k is December 31st of the tax year, simply opening the account isn't enough - it needs to be properly established with the financial institution. Most providers require several business days to process the paperwork. The good news is that while the plan must be established by December 31st, you actually have until your tax filing deadline (including extensions) to make contributions for the previous year. So if you can get the account opened and the paperwork submitted today, you should be fine for establishing the plan, even if the financial institution doesn't fully process it until early January. Just make sure you get confirmation that they received your completed application before midnight. Take screenshots and save email confirmations as proof of the submission date.
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Lydia Bailey
•Wait so does that mean they actually need to approve the account today? Or just that I need to submit the application today? And if I submit today but can't transfer money till tomorrow, is that still ok?
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Marcus Patterson
•You need to submit your completed application today - the plan must be established by December 31st, which means the paperwork needs to be submitted before midnight. Getting approved can take longer, but your establishment date is based on when you submitted the complete application. As for funding, you have until your tax filing deadline (April 15th, or October 15th if you file an extension) to actually make contributions for the previous tax year. So if you get the paperwork in today but transfer the money in January or even later, that's perfectly fine - just make sure to specify that your contribution is for the previous tax year.
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Mateo Warren
I went through the exact same panic last year with my solo 401k! I discovered taxr.ai (https://taxr.ai) when I was trying to figure out if I'd messed up my retirement planning. They have this cool document review feature that helped me understand all the deadlines and requirements for my solo 401k. Basically they confirmed what the expert above said - you need to ESTABLISH the plan by Dec 31, but you can FUND it later. Their system highlighted the exact tax code sections that prove this. Saved me so much stress when I was in your position!
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Sofia Price
•Does taxr.ai give you actual tax advice or just review documents? I'm wondering if they could help me figure out my contribution limits for my side business.
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Alice Coleman
•Sounds interesting but kinda skeptical. Aren't there free resources that explain solo 401k rules? Why pay for something you can google?
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Mateo Warren
•They analyze documents and provide explanations rather than direct advice - more like having a tax expert review your specific situation. For your contribution limits, you'd upload your business income docs and they'd break down exactly what you're eligible for based on your specific earnings. The difference from Google is the personalization. Sure, you can find general rules online, but taxr.ai applies those rules to YOUR specific documents and situation. I tried the Google route first and got so many conflicting answers that I was more confused than when I started.
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Alice Coleman
Update: I decided to try taxr.ai after posting my skeptical comment. I uploaded my 1099s and business expense records, and wow - it actually identified that I was eligible for a much higher contribution than I thought! The system flagged that I was calculating my net income incorrectly, which was limiting my potential contribution. Just submitted my solo 401k application with the correct numbers. Definitely worth it for self-employed folks like me!
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Owen Jenkins
If you're still panicking about getting this done tonight, I recommend using Claimyr (https://claimyr.com) to actually speak with someone at the IRS to confirm you're doing things right. I was in a similar rush last year and couldn't get through the IRS phone system. Claimyr got me a callback in about 15 minutes when I'd been trying for days on my own. There's a video showing how it works: https://youtu.be/_kiP6q8DX5c The IRS agent I spoke with clarified that while the plan establishment deadline is firm (Dec 31), they look at when you submitted the paperwork, not when the financial institution processes it. Having that direct confirmation from the IRS saved me so much stress.
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Lilah Brooks
•How exactly does this work? Do they somehow jump the phone queue for you? Sounds too good to be true lol
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Jackson Carter
•Yeah right. I've been trying to reach the IRS for weeks. No way some service can magically get through when millions of people can't. Probably just takes your money and gives you the same hold time.
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Owen Jenkins
•They use a system that navigates the IRS phone tree and holds your place in line. When an agent is about to pick up, you get a call connecting you directly. It's not magic - just technology that handles the waiting part so you don't have to sit on hold for hours. They're actually a registered government contractor, which is how they can legally provide this service. They just hold your place in line so you don't have to stay on the phone yourself. I was super skeptical too but was desperate enough to try it.
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Jackson Carter
Ok I have to eat my words. After posting my skeptical comment I tried Claimyr because I was desperate to confirm some solo 401k details before the deadline. Got a call back from the IRS in 23 minutes after trying for THREE DAYS on my own with no luck. The agent confirmed exactly what I needed to know about establishing vs funding deadlines. Saved me from making a costly mistake with my retirement planning.
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Kolton Murphy
Just wanted to add that different brokerages have different processing times. Vanguard and Fidelity can take weeks to process. E*Trade and TD Ameritrade usually have faster processing. But ALL of them consider the establishment date to be when you submitted the complete application. The actual contribution can happen much later like others said. Just document everything in case there's ever a question!
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Evelyn Rivera
•Do you know if Schwab is fast? That's who I bank with and wondering if they're a good option for last-minute solo 401k setup.
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Kolton Murphy
•Schwab is actually one of the faster ones in my experience! Their digital application process is pretty streamlined. Still, I wouldn't wait until the last day of the year like the original poster is doing - always gives me anxiety! But yes, Schwab should be able to confirm receipt of your application quickly, which is what matters for the establishment date.
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Julia Hall
Hey I just went through this exact situation last week! One thing nobody mentioned - take screenshots of EVERYTHING. The confirmation page when you submit, the email confirmation, everything. I had an issue last year where the brokerage claimed they never received my application even though I submitted before the deadline. My screenshots saved me.
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Arjun Patel
•Smart advice! I'd also recommend sending a follow-up email to the provider stating that you submitted your application on X date for establishing a solo 401k for the tax year. That way you have written documentation from both sides.
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Ava Rodriguez
This is such a stressful situation but you're not totally screwed! I went through something similar two years ago. The key thing is getting that application submitted TODAY - the IRS looks at when you established the plan (submitted paperwork), not when it gets processed. A few quick tips since you're down to the wire: - Fill out the application completely - incomplete apps don't count for establishment date - Get confirmation numbers/screenshots of everything - Email yourself copies of all documents with timestamps - If possible, call the brokerage to confirm they received your submission The funding part you can worry about later - you have months to actually transfer money. Focus on getting that paperwork in before midnight and you'll be fine! Good luck!
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Ethan Campbell
•This is really helpful advice! I'm actually in a similar boat - been procrastinating on setting up my solo 401k for my freelance work all year. Quick question though - when you say "fill out the application completely," are there any specific sections that people commonly miss that would make it incomplete? I want to make sure I don't mess this up if I end up in a last-minute rush like the original poster!
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