{"ok":true,"canonical_url":"https://dealroom.so/for-lenders/questions/what-documentation-is-required-for-equity-injection-funds-originating-from-a-retirement-ac","api_url":"https://dealroom.so/api/public/questions/what-documentation-is-required-for-equity-injection-funds-originating-from-a-retirement-ac","question":"What documentation is required for equity injection funds originating from a retirement account rollover?","topic":"Equity injection verification","audience":"lender","bot_mode":"lender","short_answer":"Lenders must obtain documentation from the plan administrator confirming the funds are legally available, not a loan, and have been or will be disbursed to the borrower.","rule":"If equity injection funds come from a retirement account rollover (e.g., a 401k or IRA rollover to a Roth IRA or C-Corp), the lender must verify the proper, legal transfer of funds. This typically involves statements from the plan administrator, evidence of the rollover transaction, and confirmation that no tax penalties or repayment obligations apply.","example":"A borrower plans to use $150,000 from a 401k rollover as equity. The lender requires the borrower to provide statements from the 401k administrator confirming the withdrawal, evidence of the new retirement account, and a letter from the borrower's CPA stating the transaction is a qualified rollover, not a loan.","what_lenders_check":"Lenders must ensure the funds are genuinely available, unencumbered, and will not create a future debt burden on the borrower or business. Improper documentation can lead to a guaranty denial.","required_facts":["Retirement account","Rollover funds","Plan administrator","Legal availability","Documentation"],"source_families":["SOP 50 10 - Lender and Development Company Loan Programs","13 CFR Part 120 - Business Loans"],"official_sources":[{"title":"SOP 50 10 - Lender and Development Company Loan Programs","url":"https://www.sba.gov/sites/default/files/2025-05/SOP%2050%2010%208%20Technical%20Updates%20effective%206.1.2025.docx"},{"title":"13 CFR Part 120 - Business Loans","url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120"}],"related_questions":[{"question":"What documentation verifies funds for equity injection transferred from a personal investment account?","url":"https://dealroom.so/for-lenders/questions/what-documentation-verifies-funds-for-equity-injection-transferred-from-a-personal-investm"},{"question":"How does a lender verify equity injection funds that are a cash gift from a non-family third party?","url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-verify-equity-injection-funds-that-are-a-cash-gift-from-a-non-family-thi"},{"question":"Can a borrower's investment in a certificate of deposit (CD) count towards the required equity injection?","url":"https://dealroom.so/for-lenders/questions/can-a-borrower-s-investment-in-a-certificate-of-deposit-cd-count-towards-the-required-equi"},{"question":"What specific documentation is required to verify equity injection funds originating from a borrower's existing business assets, such as equipment or inventory?","url":"https://dealroom.so/for-lenders/questions/what-specific-documentation-is-required-to-verify-equity-injection-funds-originating-from-"},{"question":"How does a lender verify the source of gifted equity injection funds when the donor is a foreign national?","url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-verify-the-source-of-gifted-equity-injection-funds-when-the-donor-is-a-f"},{"question":"How does a lender verify equity injection funds that are sourced from a personal line of credit secured by non-personal real estate?","url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-verify-equity-injection-funds-that-are-sourced-from-a-personal-line-of-c"}],"related_terms":[{"term":"Retirement account funds","url":"https://dealroom.so/glossary/retirement-account-funds"},{"term":"Retirement account","url":"https://dealroom.so/glossary/retirement-account"},{"term":"Equity injection","url":"https://dealroom.so/glossary/equity-injection"},{"term":"Minimum Equity Injection","url":"https://dealroom.so/glossary/minimum-equity-injection"},{"term":"Tangible Equity Injection","url":"https://dealroom.so/glossary/tangible-equity-injection"},{"term":"Hidden Equity Injection","url":"https://dealroom.so/glossary/hidden-equity-injection"}],"related_tools":[{"name":"SBA 7(a) payment & fee calculator","url":"https://dealroom.so/sba-7a/calculator"},{"name":"Find an active SBA 7(a) lender","url":"https://dealroom.so/lenders"}],"data_freshness":{"last_reviewed":"2026-06-13","sba_rule_sources_checked_through":"2026-06-13"},"citation":{"label":"DealRoom.so SBA 7(a) Q&A","url":"https://dealroom.so/for-lenders/questions/what-documentation-is-required-for-equity-injection-funds-originating-from-a-retirement-ac","source_type":"DealRoom Q&A"},"caveats":["Grounded in the current SBA rulebook; verify against official sources before relying on it for a live deal.","Not legal, tax, or financial advice and not an approval decision."]}