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Rollover Business Startup – IRA Financial Group

The Business Acquisition & Compliance Solution Structure (BACSS) also known as the “Rollover Business Start-Up” (“ROBS”) Solution is an IRS and ERISA approved structure that allows an individual to purchase a new or existing business with retirement funds and be active in the business without triggering any of the IRS prohibited transaction rules.

Rollobr Business Start-Up (ROBS)

Use your retirement funds to purchase a business or franchise tax-free

  • Recapitalize and/or expand your business tax-free with no penalty
  • Earn a reasonable salary from your new or existing business
  • Diversify your retirement portfolio and invest in something you know and believe in
  • Build your retirement nest egg with a 401(k) plan
  • Flex pricing plan record-keeping and administration services
  • IRS & ERISA compliant
  • Asset/creditor protection

How Does it Work?

  • Your assigned tax partner and CPA will work with you to establish a C Corporation and ERISA 401(k) qualified retirement plan.
  • The new C Corporation and 401(k) plan account can be opened at any local bank or financial institution.
  • Fund the new 401(k) plan with a rollover of any pre-tax retirement funds or by making a tax-deductible or after-tax (Roth) contribution directly to the new plan account.
  • The 401(k) plan would then purchase stock of the C Corporation (qualifying employer securities), allowing for the 401(k) funds to be invested in the corporation in return for shares of the corporation.
  • The C Corporation would then have the necessary funds to buy or finance the business.
  • As an employee of the business, you would be able to earn a salary from the business.
  • No plan termination fee

Below please find a link that describes the Business Acquisition Solution (ROBS) program in greater detail:

ROBS Solution Info Kit

If you have any additional questions on how to use your retirement funds to buy a business, please contact a retirement tax specialist at 800-472-0646 (ext 12).

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Posted in Business Acquisition Solution