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TPA Necessary for a Solo(K)?


Guest snmhanson

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Guest snmhanson

Just curious how necessary a TPA is for a barebones Solo(K) Plan held in a brokerage account? Assume client uses a current prototype document to set the plan up and is smart enough not to overfund the plan, makes contirubions in a timely manner and restates the plan/makes ammendments as necessary. No other employees, no loans, no hardship distributions and plan assets would be rolled over to an IRA at retirement and before distributions are taken. I understand this message board is for benefit consultants whos job it is to administer plans, and it is seemingly not in your best interest to say that a TPA isn't necessary. In that regard, I'm not implying in any way that a TPA isn't worth the money they're paid. Just trying to determine the risks a clients is taking on in administering their own plan withing the above constraints.

Thanks!

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Depends how competent and diligent you are. If you are willing to educate yourself enough to know when amendments are needed, understand how law changes effect your plan, stay on top of tax filings and will never have employees other than yourself you can probably do it without a TPA. But I think you'll also hear some horror stories from folks on this board about folks who came to them after things blewup on them trying to do it themselves. As the saying goes, you generally get what you pay for.

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