ROBS Business Financing – 401k Salary Contributions

If my company obtains financing via a rollover as business startup (ROBS business financing), do I have to make salary contributions to my 401k?


If you use a ROBS business financing strategy to fund your franchise or other small business, your company will have a 401k. You should defer at least 1% of your salary into the 401k and may defer up to the federal maximums. For 2016, the maximum annual contribution is $18,000 (see 401k annual contribution limits). If you are 50 or older, you may also contribute an additional amount (referred to as a catch-up contribution which the IRS left unchanged at $6,000).