Comparing key financial ratios for a business against industry standards and with its own past results can highlight trends and identify strengths and weaknesses in the business. Financial statement information is most useful if owners and managers can use it to improve their company’s profitability, cash flow, and equity value. Getting the most mileage from […]
ROBS 401(K) Plans
The Advantages of ROBS [Part 1]
![The Advantages of ROBS [Part 1]](https://www.baumcpas.com/blog/wp-content/uploads/2022/02/Piggy-bank-atop-piles-o-Benjamins-720x400.jpg)
In this article we will cover some of the most advantageous reasons why a Roll Over as Business Startup (ROBS) works for some entrepreneurs, and discuss some insights as to why we want to leverage these concepts to the entrepreneurs’ advantage. Sufficient Working Capital All too often, small businesses fail because the entrepreneur didn’t do […]
The Legality of ROBS arrangements
We get asked all the time, “How do I use my 401(k) to start a business without paying penalties and taxes from early withdrawal?” The answer comes from two sets of laws which work in tandem with one another. The first is the Internal Revenue Code (IRC) § 4975 (d)(13), and the second is ERISA […]
How a ROBS Arrangement Works
Most businesses start something like this — you wake up one day and go, “Eureka! I am going to start my own business.” You kick on your shoes, roll up those sleeves, brag to all your friends, and get to work! Then everything evolves over time from there. If your idea works, then you grow […]
The ROBS Arrangement Retirement Strategy
A ROBS Arrangement stands for ‘Roll-Over as Business Startup’. As the name implies, this is a retirement strategy that allows entrepreneurs to finance a business purchase or acquisition by using their retirement funds in a tax-deferred rollover. I am commonly asked, “seriously? I can start my own business using my 401(k) funds without penalty?” Yep, […]