Glossary · Your money in the deal
Rollovers for Business Start-ups(ROBS)
In short
A ROBS plan allows you to use your retirement funds (like a 401(k) or IRA) to fund your business acquisition without incurring early withdrawal penalties or taxes. It involves setting up a new C-corporation and a 401(k) plan within it.
What it means in a deal
ROBS is a common but complex way to meet your equity injection requirement. You roll over your existing retirement funds into a new 401(k) plan established by your new C-corp, then the C-corp uses those funds to buy the business. While powerful, this structure requires careful setup and ongoing compliance; work with a specialized ROBS provider to avoid IRS penalties.
Related terms
Common questions about Rollovers for Business Start-ups
- Can an SBA 7(a) loan help me start a brand new business?
- Can an SBA 7(a) loan be used to start a brand new business?
- Can I use an SBA 7(a) loan to start a brand-new business?
- What are the minimum cash equity requirements for acquiring a start-up business with an SBA 7(a) loan?
- Can an SBA 7(a) loan help me start a brand new business from scratch?
- Can an SBA 7(a) loan be used to start a brand new business from scratch?
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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