Rising Number of People Looking to Use Solo 401(k) Plan Loan to Pay off Holiday Shopping Debt, According to IRA Financial Group Survey
New York, NY (PRWEB) December 01, 2015 -- IRA Financial Group, the leading provider of self-directed solo 401(k) plans for self-employed and small business owners with no full-time employees, has interviewed a number of a Solo 401(k) plan clients in November 2015 and the results have shown an increased demand for its self-directed Solo 401(k) plan loan feature to be used to pay off holiday spending relate debt. “As a result of steep interest rates surrounding most credit card debt and the heavy financial burden it has on the individuals especially during the holiday season, more people are turning to the solo 401(k) plan loan feature as a way of paying off the credit card debt with a lower interest rate, “ stated Jacky Ospina, a retirement tax specialist with the IRA Financial Group. “A lot of people are seeking to establish a Solo 401(k) plan in order to take advantage of the loan feature which allows one to access up to $50,000 tax-free and penalty free from their 401(k) plan and use the solo 401(k) plan loan for any purpose, including paying off holiday related shopping expenses,” Stated Ms. Ospina.
Internal Revenue Code Section 72(p) allows a Solo 401K Plan participant to take a loan from his or her 401(k) Plan so as long as it is permitted pursuant to the business’s 401K Plan documents.
A solo 401k loan is permitted at any time using the accumulated balance of the solo 401k as collateral for the loan. A Solo 401(k) participant can borrow up to either $50,000 or 50% of their account value - whichever is less. This loan has to be repaid over an amortization schedule of 5 years or less with payment frequency no less than quarterly. The lowest interest rate that can be used is Prime as per the Wall Street Journal, which is currently 3.25%.
With IRA Financial Group’s Solo 401(k) plan loan feature, a self-employed individual or small business owner with no employees can borrow up to $50,000 tax-free and penalty free and use those funds to pay off student loan debt. There are no penalties or taxes due provided loan payments are paid on time. ““The best part of the solo 401(k) plan loan is that you can get tax-free and penalty free access to your retirement funds and use them to pay off credit card debt and at the same time pay your plan back, which in-turn increases the value of the loan, “ stated Adam Bergman, a partner with the IRA Financial Group.
IRA Financial Group’s Solo 401k Plan documents will allow a self-employed individual to use a loan from the individual 401k for any purpose, including paying off holiday related expenses.
The IRA Financial Group was founded by a group of top law firm tax and ERISA lawyers who have worked at some of the largest law firms in the United States, such as White & Case LLP, Dewey & LeBoeuf LLP, and Thelen LLP.
IRA Financial Group is the leading provider of Solo 401(k) Plan solutions. IRA Financial Group has helped thousands of clients take back control over their retirement funds while gaining the ability to invest in almost any type of investment, including real estate and private business investments without transaction fees.
To learn more about the IRA Financial Group please visit our website at http://www.irafinancialgroup.com or call 800-472-0646.
Jaclyn Baily, IRA Financial Group, LLC, http://www.irafinancialgroup.com, +1 (800) 472-0646 Ext: 9, [email protected]
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