Glossary · Your money in the deal
Rollover for Business Start-up(ROBS)
In short
A Rollover for Business Start-up (ROBS) is a strategy allowing you to use your 401(k) or IRA funds to invest in a business without incurring taxes or early withdrawal penalties.
What it means in a deal
Using a ROBS plan for your equity injection in an SBA 7(a) loan is permitted, but requires strict adherence to IRS and Department of Labor rules. Lenders will verify that the ROBS funds are truly unencumbered and treated as equity, not debt. Work with experienced professionals to set this up correctly.
Official sources
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Rollover for Business Start-up
- What are the minimum cash equity requirements for acquiring a start-up business with an SBA 7(a) loan?
- How should a lender document the 'prudent lending standards' applied when approving a 7(a) loan for a new business start-up?
- What documentation is required for equity injection funds originating from a retirement account rollover?
- Are funds from a Roth IRA eligible for my equity injection if rolled over via a "rollover as business startup" (ROBS) plan?
- Can an SBA 7(a) loan help me start a brand new business?
- What if I want to use my 401k funds, structured as a rollover, for my equity injection?
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.
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