401k Business Financing

How to Later Convert ROBS 401k Funded C-Corporation to S-Corporation

QUESTION: If it’s possible, how would I later convert the C CORP to an S CORP? What are the implications for me, the business, and other issues? ANSWER: You asked whether you can convert the C-corporation in which you have invested your retirement funds(Business Financing 401k / ROBS ) into an LLC/S–corporation. i) As long as […]

Rollovers as Business Start-Ups (ROBS) is not a Participant 401k Loan

When you take advantage of a ROBS transaction to rollover your 401k or other retirement funds to start a new business (or finance an existing business), it is not the same as taking a loan/borrowing from your 401k funds. Instead, you are investing your retirement savings in your own business by directing the 401k to by employer […]

Investing Retirement Funds in Own Business vs. a Third-Party Business

The retirement account regulations allow business owners or aspiring entrepreneurs to invest their own retirement funds in their own business (known as an active investment) or a third-party business (commonly referred to as a passive investment). Both of these investment types will not subject the retirement account holder to taxes or penalties as long as […]

Can I Use a Stock Bonus Plan Like a ROBS 401k (Business Financing 401k)

QUESTION: I have a former employer 401k and old IRA that I would like to use to for the 401k business funding structure. Can I rollover my 401k and IRA to a stocks bonus plan and then use the stock bonus plan for the 401k business funding structure? ANSWER: No. The 401k business funding structure, referred […]

Using a 401k to Buy a Business

While the Employee Retirement Income Security Act of 1974 (ERISA) permits the use of 401k retirement funds to buy your own business (commonly referred to as rollover as business start up (ROBS), the following rules should first be understood before using your 401k funds to buy a business: The ROBS 401k/PSP arrangement calls for the purchase of […]

ROBS 401k Providers List – 401k Business Financing

List of Rollover as Business Startup (ROBS) Providers It will be important to consider the below in selecting a company to help you use your retirement funds to start your own business.For your convenience, below is a list of Rollover as Business Startup (ROBS) 401k plan providers: My Solo 401k Financial http://www.mysolo401k.net/401k-business-financing/ Guidant Financial https://www.guidantfinancial.com/ Benetrends http://www.benetrends.com/ FranFund http://franfund.com/ […]

Process of Investing IRA Funds in a Franchise or Start-Up Business

This blog post discusses the two methods to invest IRA funds in a franchise or business start-up. Both methods fall within the the IRS guidelines; however, each method has a separate set of rules. Thus, it is important to fully understand and analyze both before investing IRA retirement funds in a franchise or business start-up. […]

IRS View on Using Retirement Funds (ROBS 401k) to Finance Your Own Business

 ROBS or Rollover as Business Start-Up is the coined term by the IRS to refer to the use of one’s retirement funds (e.g., IRA, 401k, 401a, 403b, TSP, 457, PSP, DBP, etc.) to finance a new or an existing business that the retirement account holder will operate. Here is a review of the IRS’s published […]

401k Business Funding Facts

The funding of your own business through the purchase of employer stock (equity investment) using retirement funds is most commonly known as 401k business funding because a 401k/PSP is adopted by the new business that is structured as a C-Corporation (because only stock can purchased not units an LLC  does not qualify for the ROBS 401k/PSP business […]

Cannot Invest Your Own solo 401k and/or IRA in Your Own Business

You cannot invest your own solo 401k in a company the Solo 401k owner and/or disqualified party (e.g.., the son, daughter, spouse, parents or grandparents of the Solo 401k owner) owns or will own an existing interest.  To learn more see ERISA Opinion Letter 2000-10A  which is summarized in this blog posting. Summary of ERISA […]

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