What if you borrow from your current employer 401k but before paying of the load you get laid off? Does the rule of paying the loan within 60 days change?
That’s the ROBS strategy. We have another episode and video on that. It can work but isn’t for everyone as it does require a c-corp and will cost you more in taxes.
When you draw a participant loan from an Individual 401(K), will the plan own the purchased business? Or is a participant loan treated like a personal loan?
My 403b does not allow for loans, only hardship withdrawals paying penalties. I am leaving the university at the end of the year and plan to start a small business, I'd like to use funds from the 403b to start it. It would be nice if I didn't have to cash it out and pay the penalties to unlock the funds to start my business. Any ideas? @@MatSorensen
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Should rename this video to "Borrowing up to 50k from 401k or IRA to start a business".
Thx for the feedback. There are three options, 401k 50k loan, ROBS, and IRA/LLC (being passive, not working in biz).
You can get more with the Rob’s method
What if you borrow from your current employer 401k but before paying of the load you get laid off? Does the rule of paying the loan within 60 days change?
I was told I had to use a c - corporation if I use my 401k
401K ROBS is what you need. Can only do this under a C Corp.
That’s the ROBS strategy. We have another episode and video on that. It can work but isn’t for everyone as it does require a c-corp and will cost you more in taxes.
Can you please put a link on the other video for Rob‘s strategy?
When you draw a participant loan from an Individual 401(K), will the plan own the purchased business? Or is a participant loan treated like a personal loan?
What if you are leaving that current employer but already have a loan from that 401K?
They talked about this in the video
Will this work with a 403b as well?
Most 403b plans allow participant loans where you can get the max loan of $50k from the plan/account that you can sue to start a biz.
My 403b does not allow for loans, only hardship withdrawals paying penalties. I am leaving the university at the end of the year and plan to start a small business, I'd like to use funds from the 403b to start it. It would be nice if I didn't have to cash it out and pay the penalties to unlock the funds to start my business. Any ideas? @@MatSorensen