Glossary · Your money in the deal
In short
A ROBS plan allows you to use your existing retirement funds (like a 401k or IRA) to invest in a business without incurring early withdrawal penalties or taxes. As a buyer, you care because it provides a way to fund your equity injection using pre-tax dollars.
Using a ROBS plan involves setting up a new C-corporation and a 401(k) plan for that entity, then rolling over your retirement funds into the new 401(k). The new 401(k) then invests in your C-corp, providing the capital for your business acquisition. This is a complex strategy that requires specialized providers to ensure compliance with ERISA and IRS rules.
Defined by DealRoom.so 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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