Can a minor open a Solo 401(k)?

Submitted by Karen Stay on Mon, 2022-06-06 16:44

Hi-We have a client whose kids own their own businesses at the ages of 15 and 19. They receive 1099 income and are interested in opening solo 401(k)’s. As a minor, are they able to do this?

Thanks!



Submitted by William Tuttle on Mon, 2022-06-06 21:26

  • The tax code or IRS regulations do not prohibit a minor from adopting a one-participant 401k.
  • It would be up to the policy of the one-participant 401k provider. If they want to support UTMA accounts. I suggest you contact them.
  • While I have no specific knowledge, E-Trade allows the set up of external trusts while still remaining the custodian. This should allow the adoption of the one-participant 401k plan with parental authorization. Then one or both parents could be the trustees.


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