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Question: Fithut has a one-participant [solo 401(k)] plan that covers Sophia, the owner and sole employee. During 2020, Fithut hired Alex, age 18, as a part-time,150-hour-a-year employee. Can the business continue to have the solo 401(k) plan, or must a standard 401(k) plan be established?

Answer: Fithut can still qualify for a solo 401(k) plan since there is an exclusion for young and part-time employees. A solo 401(k) plan can exclude from coverage any employee who is under age 21 and any employee who has not worked for at least 1,000 hours during any 12-month period [§§410(a)(1)(A) and (a)(3)(A)].