Which of the following statements concerning individual 401(k)s is false?
A)In general, individual 401(k)s have higher administrative costs than SEP IRAs .
B)Employees of the taxpayer cannot participate in individual 401(k)s.
C)Individual 401(k)s are available only to self-employed taxpayers with 100 or fewer employees.
D)Individual 401(k)s have contribution limitations.

Question

Quizplus · Accepted Answer

Individual 401(k)s, also known as Solo 401(k)s, are designed specifically for self-employed individuals or business owners with no employees other than the owner and possibly their spouse. The statement that they are available to self-employed taxpayers with 100 or fewer employees is false because having employees other than the owner and spouse generally disqualifies the business from using an individual 401(k) plan.

Which of the Following Statements Concerning Individual 401(k)s Is False