For all of our current and future Solo 401(k) clients, I would like to recognize a company named PenChecks. This company specializes in (among other things) processing all the documents and tax payments for 401(k) distributions, including withholdings. We’ve been referring clients on an individual basis for awhile now, and I’ve been impressed with their services.

Solo 401(k)s are wonderful structures, but since the client serves as the Trustee of the plan, when a distribution is taken, it is up to the Trustee to ensure that withholdings are sent in, and the proper tax filings are done. Many clients just have their CPA handle the filings and withholdings, but for those that prefer a more streamlined and frankly cheaper solution, I would highly recommend looking at PenChecks.

Generally, for a fee of $35, you can have PenChecks process the entire distribution, from federal & state withholdings, to IRS Form 945, to filing the 1099-R and 1096 forms, as needed.

You can create an online account with them, so that you can set up payment instructions, and submit information on any distribution you want them to handle. 

You can read more about their processing services on their website.  If you’d like to take a look at their fees, you can do so here. When looking at the fees, be aware that because you have a Solo 401(k), you would not need to use their “Full Service Processing”, but instead their “Payment Only Processing”.

 

I can recommend as well, Tom Drosky, their West Regional Vice President. He has handled our clients well, and can answer any questions you have, or direct you to someone who can. You can read about Tom here, and if you’d like to contact him directly, here is his information:

We have no fee-sharing arrangement, or any other arrangement for that matter, with PenChecks. They’re just a good company that make the lives of our Solo 401(k) clients who use them, easier.  If you’re looking to simplify Solo 401(k) distributions, they’re worth the time to check out, even if you’re not one of our clients (the horror).