--- title: How do I take a loan from my Solo 401(k)? description: Help Center --- [Skip to content](https://support.aetrust.com/how-do-i-take-a-loan-from-my-solo-401k#main-content) English Show submenu for translations [More support](https://support.aetrust.com/kb-tickets/new?hsLang=en) [Customer portal](https://cs.aetrust.com/tickets-view?hsLang=en) [![American Estate & Trust](https://support.aetrust.com/hubfs/Website%20Assets/Logo%20Assets/logo-text.svg)](https://support.aetrust.com/?hsLang=en) Open main navigation Close main navigation - English Show submenu for translations - [More support](https://support.aetrust.com/kb-tickets/new) - [Customer portal](https://cs.aetrust.com/tickets-view) - [Contact us](https://aetrust.com/contact) [Contact us](https://aetrust.com/contact) How can we help you? - There are no suggestions because the search field is empty. 1. [Help Center](https://support.aetrust.com/?hsLang=en) 2. [Investor Portal](https://support.aetrust.com/investor-portal?hsLang=en) 3. [General Account Questions](https://support.aetrust.com/investor-portal?hsLang=en#general-account-questions) # How do I take a loan from my Solo 401(k)? A **Solo 401(k) loan** allows you to borrow funds from your **retirement account** for personal or business use while repaying it over time. However, the IRS imposes strict **limits and regulations** on these loans to ensure compliance. This guide explains the rules, limits, and step-by-step instructions to take a **Solo 401(k) loan** from your account at **American Estate & Trust (AET).** ### **IRS Rules for Solo 401(k) Loans** Before taking a loan from your **Solo 401(k),** it is important to understand IRS regulations: ✔ **Maximum Loan Amount** – You can borrow **the lesser of**: - **50% of your vested 401(k) balance** or - **$50,000** (whichever is less) ✔ **Repayment Terms** – The loan must generally be repaid **within 5 years**, with payments made at least **quarterly**. - **Exception**: If the loan is used to purchase a **primary residence**, the repayment term can extend **up to 25 years**. ✔ **Interest Rate** – The loan must charge an interest rate that is **commercially reasonable** (typically **Prime Rate + 1%**). The **interest paid** goes back into your Solo 401(k) account. ✔ **Tax Consequences** – If you **fail to repay the loan** on time, the remaining balance may be treated as a **taxable distribution**, and if you are **under age 59½**, it may also be subject to a **10% early withdrawal penalty**. ✔ **Spousal Consent Requirement** – If you are **married**, your spouse may need to sign a **spousal consent form** before the loan is approved. ### **How to Take a Solo 401(k) Loan from AET** Follow these steps to request a loan from your Solo 401(k) through AET: ### **1. Complete the Loan Documents** Download and complete the following forms from your **401(k) plan package**: ✅ **Loan Application** ✅ **Promissory Note** (outlining repayment terms) ✅ **Spousal Consent Form** (if applicable) ### **2. Submit the Loan Request via the AET Online Portal** 1️⃣ **Log in to your AET online portal** 2️⃣ **Go to:** **Invest (DOI)** 3️⃣ **Click:** **New Investment** 4️⃣ **Select:** **Other** 5️⃣ **Enter all required loan information, including funding instructions** 6️⃣ **Upload the completed Loan Application and Promissory Note** 7️⃣ **Click:** **Review** 8️⃣ **Click:** **Submit** Once submitted, you can track your request under the **Invest DOI tab**. The loan will move through the following statuses: - **In Process** – Loan request is under review - **Approved** – Loan request has been accepted - **Completed** – Funds have been released - **On Hold for Corrections** – Additional information or corrections are needed 📌 **Processing Time**: Loan requests are typically **processed within 3-5 business days**, assuming all documentation is in order. ### **Important Considerations** ⚠ **Taking a loan reduces your retirement balance** – While repaying the loan with interest, you may miss out on potential investment growth within your **Solo 401(k)**. ⚠ **Loan Defaults Have Tax Consequences** – If you default on the loan (fail to make timely payments), the IRS may classify the remaining balance as a **distribution**, making it **taxable** and potentially subject to a **10% early withdrawal penalty**. ⚠ **Loan Repayments Must Be Made on Time** – The **repayment schedule** should be followed strictly to avoid IRS penalties. Payments must be made at least **quarterly**. ### **Final Steps** Once your loan is approved and funded: ✔ **Start making scheduled loan repayments** ✔ **Ensure payments follow IRS guidelines** ✔ **Track your loan status through the AET online portal** If you have questions or need assistance, **contact AET Support** for further guidance. - [Investor Portal](https://support.aetrust.com/investor-portal?hsLang=en#main-content) - [Online Portal](https://support.aetrust.com/investor-portal?hsLang=en#online-portal) - [Transfer-ins and Rollovers](https://support.aetrust.com/investor-portal?hsLang=en#transfer-ins-and-rollovers) - [General Account Questions](https://support.aetrust.com/investor-portal?hsLang=en#general-account-questions) - [Tax Reporting and Compliance](https://support.aetrust.com/investor-portal?hsLang=en#tax-reporting-and-compliance) - [Signing Request](https://support.aetrust.com/investor-portal?hsLang=en#signing-request) - [Bill Pay](https://support.aetrust.com/investor-portal?hsLang=en#bill-pay) - [Prohibited Transactions and Compliance](https://support.aetrust.com/investor-portal?hsLang=en#prohibited-transactions-and-compliance) - [Fees and Payments](https://support.aetrust.com/investor-portal?hsLang=en#fees-and-payments) - [Investment Questions](https://support.aetrust.com/investor-portal?hsLang=en#investment-questions) - [Account Closure and Transfer-out](https://support.aetrust.com/investor-portal?hsLang=en#account-closure-and-transfer-out) - [Assets](https://support.aetrust.com/investor-portal?hsLang=en#assets) - [Business Portal](https://support.aetrust.com/business-portal?hsLang=en#main-content) - [Getting started](https://support.aetrust.com/business-portal?hsLang=en#getting-started) - [FAQ](https://support.aetrust.com/business-portal?hsLang=en#faq) - [Training](https://support.aetrust.com/business-portal?hsLang=en#training) - [Investments](https://support.aetrust.com/business-portal?hsLang=en#investments) [![American Estate & Trust](https://support.aetrust.com/hubfs/Website%20Assets/Logo%20Assets/logo-text.svg "American Estate & Trust")](https://aetrust.com) [mailto:support@aetrust.com](mailto:support@aetrust.com) Copyright © 2025, American Estate & Trust