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  • Avatar somethingmorethanfree 
    Participant
    Status: Spouse
    Posts: 32
    Joined: 01/27/2016

    Solo 401k question / scenario.

    Does it make sense for a non working spouse to start a side “business” with really the main goal to be able to contribute to a solo 401k? Would this make sense in any scenario? Would your contributions be limited to the business income? Has anyone done something like this already? Or am I missing something?

    #213838 Reply
    CordMcNally CordMcNally 
    Participant
    Status: Physician
    Posts: 2132
    Joined: 01/03/2017

    Why did you put “business” in quotations? I think the main goal of any business should be to succeed and thrive. It doesn’t make sense if it isn’t a true business as it sounds like the recipe for failure is close to 100%.

     

    Also, is your user name a homage to Jason Isbell?

    “But investing isn’t about beating others at their game. It’s about controlling yourself at your own game.”
    ― Benjamin Graham, The Intelligent Investor

    #213842 Reply
    Avatar somethingmorethanfree 
    Participant
    Status: Spouse
    Posts: 32
    Joined: 01/27/2016

    Why did you put “business” in quotations? I think the main goal of any business should be to succeed and thrive. It doesn’t make sense if it isn’t a true business as it sounds like the recipe for failure is close to 100%.

     

    Also, is your user name a homage to Jason Isbell?

    Click to expand…

    I put “business” in quotations because I was thinking that I’m not really trying to start a business time wise but would consider something for the tax benefit. A bit hypotheticall I guess but always trying to think of ways to avoid taxes.

    Yes, Jason Isbell! It displays pretty funny on the screen but had to go with it. A big fan.

     

     

    #213845 Reply
    CordMcNally CordMcNally 
    Participant
    Status: Physician
    Posts: 2132
    Joined: 01/03/2017
    I put “business” in quotations because I was thinking that I’m not really trying to start a business time wise but would consider something for the tax benefit. A bit hypotheticall I guess but always trying to think of ways to avoid taxes.

    Click to expand…

    Honestly, it sounds like it wouldn’t be a great idea in your situation if your only goal is to avoid taxes. Making money needs to be the goal of a business. If you aren’t going to put the time into it then I find it hard to believe that you’re going to make any money. As has been pointed out in previous threads, it’s a privilege to pay taxes (to a degree) and at some point you just run out of options on trying to avoid taxes. I’d worry more about trying to make more money than trying to avoid taxes.

    Yes, Jason Isbell! It displays pretty funny on the screen but had to go with it. A big fan.

    Click to expand…

    He’s criminally underrated.

    “But investing isn’t about beating others at their game. It’s about controlling yourself at your own game.”
    ― Benjamin Graham, The Intelligent Investor

    #213846 Reply
    Avatar somethingmorethanfree 
    Participant
    Status: Spouse
    Posts: 32
    Joined: 01/27/2016
    Honestly, it sounds like it wouldn’t be a great idea in your situation if your only goal is to avoid taxes. Making money needs to be the goal of a business. If you aren’t going to put the time into it then I find it hard to believe that you’re going to make any money. As has been pointed out in previous threads, it’s a privilege to pay taxes (to a degree) and at some point you just run out of options on trying to avoid taxes. I’d worry more about trying to make more money than trying to avoid taxes.

    Click to expand…

    You’re right. It seems I was thinking too much about avoiding taxes and not enough about generating income.

    #213883 Reply

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