If you want to start a new business and only have money in your IRA/401K to fund it, then you might be tempted to use a “ROBS” strategy whereby you can use your IRA/401K funds to start the business. The result of this decision is that your new business is “trapped” in a C Corp inside a 401K “forever”. This results in the least-efficient form of taxation trapped a vehicle that forever produces income taxed at your highest tax rates for the life of your business. Please see us before making this decision. We can show you how to tax-efficiently avoid using this strategy so that you can end up with your business in a more-tax-efficient S Corp where you can take advantage of all of the tax advantages of an S Corporation: shareholder wage, QBID, PTET, long-term capital gains rates on sale, no double taxation.
Accounting and Consulting