ROBS 401(k): Turn Retirement Savings Into Business Capital
A ROBS rollover lets you fund a new business, franchise, or acquisition with your retirement savings. No loan to repay, no early withdrawal penalty, and no tax due when structured correctly.
27,000+
Clients in all 50 states
$8B+
Assets under administration
97%
Client retention rate
$0
Transaction & asset-value fees
What is ROBS?
ROBS, short for Rollover as Business Startups, is an IRS-recognized way to use your retirement savings to start, buy, or grow a business without taking a loan or paying early withdrawal taxes and penalties.
With a ROBS 401(k), you form a new C corporation that sponsors its own 401(k) plan. You roll eligible funds from a 401(k), 403(b), 457(b), or traditional IRA into that plan. The plan then buys stock in your corporation, and the corporation uses that cash to run the business.
Because the money moves from one retirement plan to another and is invested in company stock, it is not a distribution. You owe no income tax, no 10% penalty, and no loan payments. The trade-off is ongoing compliance: a ROBS plan must follow IRS and Department of Labor rules every year, which is why most owners use a ROBS provider.
How the ROBS Structure Works
A ROBS structure for business has four parts that work together. Each step must be done in order for the rollover to stay tax-free.
- Your existing retirement account. A 401(k), 403(b), 457(b), SEP, SIMPLE, or traditional IRA from a prior employer.
- A new C corporation. ROBS requires a C corporation because only a C corp can sell stock to its own 401(k) plan. LLCs and S corps do not work.
- A new ROBS 401(k) plan. The corporation sponsors a 401(k) that allows investment in company stock. Your funds roll into this plan tax-free.
- The stock purchase. The plan buys shares of the C corporation at fair market value. The corporation now has working capital, and your 401(k) owns that stake.
You work in the business as a W-2 employee, draw a reasonable salary, and can keep contributing to the ROBS 401(k) like any other employee.
Do I Qualify for ROBS Funding?
You likely qualify for ROBS funding for your business if you can answer yes to all three:
01
You have eligible retirement funds
Usually $50,000 or more in a 401(k), 403(b), 457(b), or traditional IRA. Funds in a current employer’s plan generally cannot be rolled over until you leave that job.
02
You will work in the business
You must be a bona fide W-2 employee, not a passive investor. You can draw a reasonable salary and join the company 401(k) like any other employee.
03
The business is an active, legal C corporation
Startups, franchises, acquisitions of existing businesses, and expansions all qualify, organized as or converted to a C corp. Passive investments such as rental real estate do not.
Why Choose IRA Financial As Your ROBS 401(k) Provider?
Not all ROBS providers are the same. Some stop after setup. IRA Financial builds your ROBS structure, rolls over your funds, and then keeps the plan compliant every year with Form 5500 filings, annual stock valuations, plan document updates, and IRS audit support, all for one flat annual fee.
No commissions or surprise charges.
Talk to a ROBS specialist by phone or live chat, Monday to Friday, 8am to 5pm CT.
Fund a startup, franchise, existing business purchase, or expansion.
Serving investors in all 50 states.
Experience with Navigating IRS Rules & Regulations.
Administration services to keep you IRS compliant.
Simple, Transparent ROBS Pricing
We believe investing for retirement shouldn’t come with complicated fee structures or fine print. You keep more of what you earn, and you stay in control every step of the way.
Simple Transparent Pricing
We believe investing for retirement shouldn’t come with complicated fee structures or fine print. You keep more of what you earn, and you stay in control every step of the way.
ROBS 401(k)
$1200
/ annually
- $3500 setup fee
- Best plan to grow or fund your business tax free!
- Earn a salary
- Sell your business tax free
- Generate tax-free income
- Guaranteed IRS audit protection
How to Open a ROBS 401(k)
Opening a ROBS structure is easy when done right. Our team handles the setup so you can roll over your retirement funds without penalties, meet IRS requirements, and focus on building your business.
01
Open Your Account
Opening a self-directed retirement account is simple. Submit your online account application in just a few minutes. Get Started
02
Finish your application with a ROBS specialist
Our experts will guide you through the final steps, ensuring everything is set up correctly and fully compliant.
03
Establish a C Corporation and New 401(k)
As your ROBS 401(k) provider, we’ll set up a C corp and create a qualified plan for funding your business on your behalf.
04
Roll Over Funds and Capitalize Your Business
Your retirement funds roll into the new plan, the plan buys stock in your corporation, and the cash lands in your business bank account, ready to use.
The Benefits of a ROBS 401(k)
Tax-Deferred
Access your retirement savings without early withdrawal penalties or taxes to start or grow your business.
No Loans, No Debt
You’re funding your business with your own money, avoiding bank loans, high interest rates, or personal credit risks.
Ownership and Control
Unlike investors or lenders, a ROBS doesn’t require giving up equity or control of your business.
Stronger Cash Flow
Without loan payments or investor obligations, your business keeps more of its revenue early on, improving stability and growth potential.
Covers All Costs
Unlike SBA loans or traditional financing, ROBS funds can cover startup costs, payroll, marketing, real estate, inventory, or even franchise fees.
ROBS 401(k) vs. Other Funding Options
ROBS | SBA Loan | Investors | |
Book a Free ROBS Consultation
Not sure if a ROBS rollover is right for you? Book a free call with a ROBS specialist. We’ll check whether your retirement account and business qualify, walk through costs, and map out a funding timeline.
ROBS 401(k) Frequently Asked Questions
Answers to some of the most commonly asked questions about the ROBS structure.
Rollover as Business Startups (ROBS) is a method of funding a small business or franchise using your retirement funds. In fact, ROBS is the only legal way to use your retirement funds to invest in yourself without incurring tax penalties.
Any retirement account that allows rollovers into a traditional 401(k) plan, including traditional IRAs, SEP IRAs, SIMPLE IRAs, 401(k)s, and 457(b) plans. Roth IRAs cannot be used since they are not eligible for rollover into a traditional 401(k).
The business must be active, for-profit, and federally legal. ROBS cannot be used for businesses that only generate passive income (such as rental properties with no active management).
- Real estate businesses qualify, but at least 50% of assets must be actively managed real estate (not passive investments).
- Personal-use property is not allowed.
Yes! ROBS funds can be combined with personal savings, co-owners, investors, or even an SBA loan to start or grow a business.
Yes. Under the ROBS structure, the owner must be an employee of the business. The salary must be reasonable for the role and industry to follow IRS guidelines.
Each year, IRS Form 5500 must be filed to report the value of 401(k) plan assets. This filing is required for IRS compliance.
Yes. The business must undergo an annual independent valuation to determine the fair market value of the stock held by the 401(k) plan. This valuation is required for Form 5500 reporting.
IRA Financial charges a one-time $3,500 setup fee and $1,200 per year for plan administration and compliance.
Yes. A ROBS 401(k) is a qualified plan, so required minimum distributions start at age 73 (75 for those born in 1960 or later). Because most ROBS owners own more than 5% of the company, the “still working” exception does not apply, so RMDs begin by April 1 of the year after you turn 73 even if you still run the business.
Yes. ROBS is permitted under the Internal Revenue Code and ERISA, and the IRS has published guidance on how to run a compliant ROBS plan. The IRS does watch these plans, so ongoing compliance matters more than setup.
No. People often call it a ROBS loan, but there is no lender and nothing to repay. You invest your own retirement funds in your company’s stock.
If you sell, the plan sells its shares and the proceeds stay in your 401(k), tax-deferred. If the business closes, the plan’s shares may lose value, and the plan is terminated with any remaining assets rolled to an IRA.
See What Our Clients Have to Say
IRA Financial made a potentially complicated ROBS transaction feel seamless. They provided clear direction at every step, was always available for questions, and ensured my business was funded on schedule. Their professionalism and expertise gave me total confidence in my new business structure. Five stars for IRA Financial and the team!
The ROBS process can be difficult for somebody with no prior experience to understand. They took the time and walked me through each step of the process. It was more than customer services, I could tell they genuinely cared. I appreciate their hard work and patience.
They did a great job getting my very complicated ROBS structure and documentation set up properly. Timely, friendly, and at a great price! They went out of their way to make sure that all of my questions were answered and all of my concerns were addressed quickly and professionally. Looking forward to using IRA Financial for years to come!
Ready to Invest in Your Future?
Whatever your business funding strategy, we do it all. Launch or grow your business with a ROBS plan designed to put your retirement savings to work.
#1 IRS Audit Protection
Flat Rate, No Hidden Fees
Expert Live Support
Total Investment Freedom
