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New 401k for office with employees - need PS and Mega Roth

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  • New 401k for office with employees - need PS and Mega Roth

    I own a small office with 5 employees (myself and wife included). Been doing simple IRA for 5 years. Currently llc taxed as sub s. I see tons of options for sole owner 401k plans that support profit share and mega roth conversions, having difficulty finding one for a small group.

    A few questions:

    Do I need to find a different tax structure that allows me to be a sole owner without employees ie form another llc that contracts with the dental office to provide services? That way all the profits are in the contracting llc not the practice llc?

    Which 401k provider will allow both small groups, profit sharing and the mega roth?

    At what income level does a cash balance or defined benefit make sense?

    Thanks for your help.


  • #2
    As the owner regardless of how you organize the business I think you’ll have control or affiliated service group issues if your plan doesn’t cover all the employees. This sounds like a spiritrider or Kon question.

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    • #3
      You won't be able to restructure to get around paying employees 401k match. You'll want a good advisor to help select record keeper and maybe TPA. Likely you'll want a safe harbor 401k with new comparability profit sharing. A good TPA will do all the calculations. The calculation for PS and MBDR are similar, so usually just doing profit sharing makes the most sense. CBP makes sense in high income that is steady but also if the owner is older with younger employees. You really just need an illustration customized to your practice. Nothing we can help with too much. You need to pay professionals for this service. This is generally not DIY stuff.

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      • #4
        Reached out to Kon. Thanks for your help.

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