A ROBS plan, or Rollover for Business Startup, allows you to invest your retirement funds in the stock of your new business by rolling over your funds into a new retirement account. You’re not taking out a loan, so you won’t incur debt to a lender and you won’t pay any interest or early distribution penalties.

Once your rollover is complete and your business is funded, your company can use these funds for almost any business purpose, including buying property and equipment, paying salaries or rent and buying a business or franchise.

We charge a flat fee of $4,500, which includes:

• Incorporation of your new business (you’ll pay the state incorporation fee) and facilitation of the roll-over of your funds from up to three retirement accounts.
• The addition of a partner and their retirement funds is simple and only costs an additional $1,000
• Filing of the necessary government reports for your fund

We ask for a small up-front deposit of $1,000, which will be your equity contribution to your new company. We do not collect the remainder of our fee until your retirement funds have been rolled over to your new retirement plan and your company is funded

Accelefund will also act as the service provider for your retirement plan.  We will prepare and distribute the required reports and statements for your plan participants, prepare and help you file required government reports such as Form 5500 and we provide those services for a small monthly administration fee of $99, which is billed via monthly bank draft to your corporation. A complete list of the administrative services provided is available upon request.

We also facilitate your retirement plan’s ERISA fidelity bond. For most of our clients, the cost of the fidelity bond is about $100 per year.

If you have qualified pre-tax funds that can be rolled over into another qualified plan, then you are eligible for a ROBS plan. We can help you identify eligibility.

Almost all types of tax-favored retirement accounts can be rolled over, including 401(k), 403(b), 457(b), IRA, profit sharing, SEP, SIMPLE and government Thrift plans. Account types that cannot be used are Roth accounts and IRAs inherited from a non-spouse.

There is no maximum account you can transfer. Accelefund requires a minimum of $45,000 be transferred to make the transaction economically feasible for you.

No. You can transfer only the amount you need to start or buy a business. However, one of the advantages of the Pension Transfer Trust Plan is that your Pension Transfer Trust Plan account can also invest in mutual funds offered by Empower Retirement Services. Some of our clients will transfer all their funds to the new retirement plan, invest what they need for their business and then invest the remaining balance in the mutual funds offered by the plan.

It takes about two to three weeks to complete all the steps to fund your new business. The only variables we cannot control which can speed up or slow down your specific case are how quickly the state in which you choose to incorporate will process your new incorporation, and how quickly your current account custodian will respond to your request to transfer your funds from your existing account. Some states, such as California, take a little longer to process new incorporations.

While most custodians reply promptly to a request to initiate a rollover, others drag their feet. Whether your current custodian decides to wire transfer your funds or mail a check will affect the time your funds are available to you. We’ll work closely with you to minimize these potential delays.

You can fund virtually any type of business, including real estate, with a few exceptions:

• Businesses whose primary purpose is lending to others
• Transactions that mainly focus on self-dealing
• Companies that buy goods or services from you or a related business
  • Example: your company can buy an apartment building as long as you are actively managing the property but you or a relative cannot live in one of the apartments – even if you pay fair market value rent. Call Accelefund to discuss your particular situation.

It depends on the provisions in your employer’s plan, so be sure to check with your existing employer. Many plans do not allow “in-service distributions,” meaning they do not allow access to your retirement funds while you are still employed.

However, if you rolled over funds from a previous job into your existing plan, you usually will be allowed to access those funds while you are still employed. Here is the specific question to ask your employer: Can I take a portion of my account and transfer it to another qualified plan while I am still working?

Yes. In fact, to participate in a ROBS plan, you must be an employee of the corporation and pay yourself a reasonable salary for the services you perform.

Unlike other plans, with the Pension Transfer Trust Plan, your retirement plan can own as much or as little stock in your corporation as you wish. You can also contribute personal funds to your corporation and be a personal stockholder in your corporation. Your ownership will be proportional to the capital contributed to the corporation.

By law, all employees who meet eligibility requirements must be allowed to participate in your ROBS plan. This gives you a great advantage to attract quality employees to your business even though your business may be small. With our Pension Transfer Trust Plan, you can choose from five different plan options that best fit your business.

You are required to offer eligible employees the opportunity to purchase stock in your business with their Pension Transfer Trust Plan accounts. However, few – if any – employees choose to do so. Such an investment does not provide the liquidity most employees prefer. The Pension Transfer Trust Plan is set up where your eligible employees have the option to invest as much of their plan contributions as they choose in mutual funds offered by Empower Retirement Services which provides much more liquidity to them.

A C-corporation is the only legal entity that qualifies to be a sponsor of the Pension Transfer Trust Plan. Other legal structures, such as LLCs and S-corps are “pass-through” entities and, therefore, do not qualify.

That’s only true if the corporation issues dividends to its taxable stockholders. Dividends are usually only issued if your corporation has excess cash AFTER paying you a salary and perhaps a bonus and making tax-deductible contributions to the retirement plan for your benefit and the benefit of your employees.

Most of our clients use excess corporate cash to begin buying back the stock held by the retirement plan. This allows you to provide more liquidity in your own retirement account. If your corporation did pay a dividend, remember that dividend would be paid to the stockholders of the corporation, which in this case would be the tax-exempt Pension Transfer Trust Plan. The dividend would not be taxable until it is taken out as a distribution.