The Ultimate Solo 401(k) can trace its history back to 1875 when the American Express Company established America’s first corporate pension plan.
In 1935, President Franklin D. Roosevelt signed the Social Security Act, a government administered – and guaranteed – retirement savings program.
In 1939, a predecessor of the modern-day 401(k) Plan, “Section 401a” first appeared in the Internal Revenue Code.
In 1974, the U.S. Congress passed the Employment Retirement Income Security Act (ERISA) and the IRA (Individual Retirement Account) was born. This law gave working Americans a strong tax-incentive to save towards their retirement.
In 1978, Congress went one step further and passed the Tax Reform Act. This legislation expanded Section 401 of the Internal Revenue Code and included a paragraph (k) which let employees designate a portion of their income as “deferred compensation” – another tax break to aid them in preparing for retirement.
In 1980, the next upgrade came about when Ted Benna drafted the first “401k” pension plan, and set the stage for what was to become the most popular corporate pension plan in America.
In 2001, Congress passed the Economic Growth and Tax Relief Reconciliation Act (EGTRRA) which, among other things, amended the laws governing 401(k) plans. These changes enabled and encouraged self-employed persons to enjoy the advantages of 401(k) plans without the administrative costs and burdens that typically accompany 401(k) plans. Hence the Solo 401(k) was born.
In 2006, Congress passed the Pension Protection Act (PPA) which permanently extended the use of the Roth (tax-free) component as part of annual contributions made to 401(k) plans.
In 2009, Broad Financial introduced The Ultimate Solo 401(K) providing diversification and control like never before.