Learn how to use your 401(k), IRA, or other retirement savings to fund new business startup costs or purchase a new business with no early withdrawal penalties using a ROBS plan, also known as a Rollover as Business Startup.

Certified Public Accountant Mickey Parker, co-owner of Accelefund joins SBDC director, Kelly Bearden on this week’s free webinar to provide details on the Rollover as Business Startup (ROBS), a tax-free finance transaction that allows entrepreneurs to use their 401(k), IRA, or other retirement savings to fund new business startup costs or purchase a new business without early withdrawal penalties.

Bearden begins the webinar with a look at business and economic insights shared at the annual ASBDC conference held in Florida.

This marks the 357th episode of the “Webinar Wednesday” business series that provides news and information helpful to employers and business owners.

The CSU Bakersfield SBDC provides free one-on-one help to small business owners. New and existing businesses can go to https://csubsbdc.com/ for more information or to sign up to meet with a business advisor at no cost.

TIMESTAMPS

00:00 Intro

00:27 What’s up today September 3, 2025

03:03 Capital Corridor – Is there money for everyone?

04:50 Economic Corner – Kelly shares info shared by Mr. Michael Brown, VISA International on Business and Economic Insights at the ASBDC national conference in Florida https://usa.visa.com/partner-with-us/visa-consulting-analytics/leverage-economic-and-business-insights.html#:~:text=U.S.%20Perspectives,-Explore%20trends%20in%20U.S.%20economic

06:09 Small business concerns have shifted

07:28 Entrepreneurship remains strong in the U.S.

08:03 Where is entrepreneurship strongest – by state

12:11 Kelly introduces Certified Public Accountant, Mickey Parker, co-owner of Accelefund https://accelefund.com/ https://accelefund.com/about/

13:17 Mickey begins to speak

13:33 Mickey begins his presentation – How to use your 401(k) or IRA as capital to start or buy a business without paying taxes or penalties

13:53 Importance of boosting California businesses and communities

14:23 Most common reason people don’t start a business is lack of funding or financial resources

14:55 Common or traditional sources of capital

15:46 A distribution from your retirement account is a taxable event

16:10 Using a ROBS plan avoids paying taxes or penalties

17:03 ROBS – Rollover for Business Startup – is explained and its purpose is outlined. It enables funding a new C Corporation with retirement funds without tax or penalties, to provide equity for SBA loan requirements

18:25 Differences between a ROBS and a self-directed IRA are clarified. A ROBS allows active business management and self-payment, while a self-directed IRA restricts management and ownership, typically capping ownership at 49%

19:13 ROBS is a 5-step process

21:47 Why do I have to use a C Corporation?

23:22 How do I set up a ROBS? -The setup fee is typically around $5,000, with some variation by provider, while administration costs range from $99 to $150. The approach emphasizes cautious talk with CPAs and ERISA references to ensure legality and compliance

24:54 How to use retirement funds for starting a business, including eligibility of various account types and strategies for partial rollovers

25:09 The Big Question – Is It Legal?

27:37 What Retirement Funds Qualify for ROBS?

28:14 What Accounts Can’t Be Transferred to a ROBS?

28:33 Can I Use My 401K from My Current Employer?

29:44 What Kind of Business Can I Start or Buy?

31:00 Examples of businesses funded, the possibility of mixing personal funds with retirement funds, and how equity injections can support SBA loan requirements for a million-dollar business

32:58 Are there Any Other Requirements to Use a ROBS?

33:49 What is Considered a Prohibited Transaction?

35:30 Can I Use a ROBS to Capitalize an Existing Business?

36:30 What Are My Options in Setting Up My New Retirement Plan? -Retirement plan options and administration; explanation of profit sharing and 401(k) type plans; benefits of a ROBS plan, and ongoing maintenance and compliance tasks

37:51 Mickey outlines how to exit a ROBS plan, including stock buyback rules, potential options like selling the company, and tax implications. A California example illustrates net unrealized appreciation and tax deferral strategies

43:00 Kelly rejoins Mickey for questions and answers with attendees