You can find the legality of using retirement funds to purchase employer corporate stock in the Internal Revenue Code and under ERISA law. Our in-house retirement tax professionals have spent the last two years developing an IRS and ERISA compliant structure. This allows individuals to use their using retirement funds to acquire or invest in a business tax-free – in other words, the Business Acquisition Solution!
Because the IRS stresses the importance of compliance when using retirement funds to purchase a business, it’s crucial to work with a company that operates with a team of tax and ERISA professionals. Notably, IRA Financial Group has worked at some of the largest law firms in the United States, including White & Case LLP and Dewey & LeBoeuf LLP. In other words, our experience and professionalism guarantees speed and compliance.
Our standardized procedures can work via phone, e-mail, fax, and mail. Your funds will be ready for investment into your new or existing business within 14-21 days.
Step 1 – Establishment of New Corporation
IRA Financial Group’s in-house tax and ERISA professionals will establish a corporation. And, our team will ensure that the incorporation process is accurately complete and in accordance with state law. Our retirement tax professionals have experience with the incorporation process in all 50 states. This includes the District of Columbia.
Your corporation will be incorporated in the State where you plan to conduct business. And if you plan to conduct business in multiple states, it will be conducted in more than one state. The IRA Financial Group’s retirement tax professionals can assist you in satisfying all internal corporate formalities. This includes establishing a board of directors, appointing officers, and completing the corporate resolution and minutes. Upon the incorporation of the entity, our in-house retirement tax professionals will acquire an Employer Tax ID Number with the IRS for your new corporation.
Step 2 – New Corporation Adopts 401(k) Plan
The IRA Financial Group’s in-house ERISA professionals will establish an IRS approved 401(k) Plan for your new corporation. We’ll draft Plan documents so the new corporation will be the sponsor of the new 401(k) Plan. In other words, the Plan documents will appoint the new business owner as the trustee of the plan. Its customization will be based on the financial goals of you and the business. Therefore, the Plan will be specifically drafted to allow for investment in your new corporation.
Step 3 – Rollover/Transfer of Funds to your New Corporation
The IRA Financial group’s in-house ERISA professionals will guide you through the process of opening a bank account for your new 401(k) Plan. Notably, you can open the account at any local bank, credit union, or financial institution. Additionally, we plan to help you complete the necessary transfer/rollover documents to transfer your retirement funds from your previous employer or IRA to your company’s new 401(k) Plan, tax-free. Our in-house ERISA professionals will guide you through the entire rollover/transfer process. So, your retirement funds will transfer to your new 401(k) Plan quickly and tax-free.
Step 4 – 401(k) Plan Invests in the new Corporation
The IRA Financial Group’s in-house retirement tax professionals will draft a customized stock purchase agreement detailing the 401(k) Plan’s purchase of new company stock. The IRA Financial Group will coordinate with the selected independent business appraisal to assure that the stock purchase agreement is in compliance with IRS and ERISA rules. Once the 401(k) Plan purchases stock in the new corporation, the corporation will have the funds to purchase new business assets or help grow the business.
Step 5 – Compliance with IRS and ERISA Rules
Once your retirement funds are invested in your new business, the retirement tax professionals at the IRA Financial Group will continue to work with you to ensure that the structure remains compliant with IRS and ERISA rules and procedures. In the case of a corporation with employees, the IRA Financial Group will work with a third-party administrator to ensure that the Plan remains compliant so that the structure continues to meet IRS and ERISA rules and requirements.
Work Directly with our on-site tax and ERISA professionals!
Each client of the IRA Financial Group receives an individual retirement tax professional who will customize a structure that satisfies his or her financial and retirement needs. Furthermore, they ensure that the development of the structure is in full IRS & ERISA compliance.
When you’re ready to begin or learn more about the Business Acquisition Solution, contact IRA Financial Group today.