Glossary · Your money in the deal
ROBS transaction(Rollover for Business Startups transaction)
In short
A specific method allowing you to use your 401(k) or other retirement funds to finance a business purchase without incurring taxes or penalties. It's a complex but powerful equity injection strategy.
What it means in a deal
This strategy involves setting up a new C-corporation and a 401(k) plan, then rolling over your existing retirement funds into the new plan. The new 401(k) then invests in your C-corp, providing the equity injection. Ensure strict IRS compliance and consult specialists for this approach.
Related terms
Common questions about ROBS transaction
- What are the specific requirements for a lender to document and verify an equity injection from a retirement account structured as a ROBS (Rollover for Business Startups) transaction?
- Are funds from a Roth IRA eligible for my equity injection if rolled over via a "rollover as business startup" (ROBS) plan?
- Who actually lends the money in an SBA 7(a) loan transaction?
- When is a business valuation required for a change of ownership transaction exceeding $500,000?
- When is a business appraisal required for a change of ownership transaction exceeding $500,000?
- Can funds from a retirement account, like a 401(k), be used for my equity injection if rolled into a new C-corp via a ROBS plan?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
Figure out your down payment and equity injection
Tell us your purchase price and how you're funding the down payment — we'll sanity-check the equity injection and show what lenders will actually accept.
Free · No documents · Usually same-day
Backed by data on 1,000+ SBA lenders and 300,000+ funded deals. Your details go only to lending partners you ask to be matched with — never sold to advertisers.