schirallicpa Posted March 21 Report Share Posted March 21 Taxpayer's father set up taxpayers business inside his 401K. Business is run as a C-corp. No real estate involved. Father died in Nov and now Taxpayer is beneficiary of this 401K. 401K has some stock assets of other companies - like normal. And owns this business. At Dec 31, 2022 the Corp had retained earnings of 30K. I'm thinking we need to do an accounting thru DOD and find the value at DOD, which won't be a whole lot different. So then what? Can he take distribution of the business and roll over the other assets to his own retirement account. Does this retirement account need to be a 401K or can it be a Roth? Or does he just leave stuff as is and take the 10 years to deal with it. Any thoughts on this will be much appreciated. I'm kinda treading. 1 Quote Link to comment Share on other sites More sharing options...
Lee B Posted March 21 Report Share Posted March 21 Just curious, who was the fiduciary for the 401 K ? Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted March 21 Report Share Posted March 21 How do you put a business that you run into a 401K? I am pretty sure that is a prohibited transaction....or is it? Tom Longview, TX Quote Link to comment Share on other sites More sharing options...
Lion EA Posted March 21 Report Share Posted March 21 ROBS. Or, are ROBS only within IRAs? Too complex and scary for me. If you make one misstep, you disallow the entire retirement account. And, now inherited. Wow! I think you have a big, hopefully very profitable, summer project. 1 Quote Link to comment Share on other sites More sharing options...
jasdlm Posted March 21 Report Share Posted March 21 44 minutes ago, Lion EA said: ROBS. Or, are ROBS only within IRAs? Too complex and scary for me. If you make one misstep, you disallow the entire retirement account. And, now inherited. Wow! I think you have a big, hopefully very profitable, summer project. Agreed. ROBS. Must follow the requirements very carefully. Agree with a big, very profitable summer project. 1 Quote Link to comment Share on other sites More sharing options...
Randall Posted March 21 Report Share Posted March 21 I can't imagine this. What will people think of next. 1 Quote Link to comment Share on other sites More sharing options...
schirallicpa Posted March 21 Author Report Share Posted March 21 Ohhh noooo - don't leave me flailing on my own...... Already on extension. I can handle that part. Quote Link to comment Share on other sites More sharing options...
Lion EA Posted March 21 Report Share Posted March 21 How long ago did ROBS come about? I wonder how may are getting inherited each year now with our aging baby boomer population. We're expecting your ROBS webinar this fall to teach us everything you learn! 1 Quote Link to comment Share on other sites More sharing options...
Lion EA Posted March 21 Report Share Posted March 21 Do you know the IRS Liaison Joe McCarthy. His wife, also with the IRS, may be one of their experts on ROBS. If not, either Joe or his wife would know who is. [email protected] 203.415.1015 1 Quote Link to comment Share on other sites More sharing options...
Lee B Posted March 21 Report Share Posted March 21 Just skimmed thru some guidance, you have a number of tricky issues to deal with. If it was my client, I would either refer them to someone else or pay an expert to provide detailed guidance. 2 Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted March 21 Report Share Posted March 21 12 minutes ago, Lee B said: If it was my client, I would either refer them to someone else or pay an expert to provide detailed guidance. I just did a quick internet search and I came to the same conclusion. ^^^^ Tom Longview, TX 1 Quote Link to comment Share on other sites More sharing options...
mcbreck Posted March 21 Report Share Posted March 21 1 hour ago, Randall said: I can't imagine this. What will people think of next. Before IRA enforcement was a real thing - client bought a "bond" for his IRA from a company with a 30% interest rate. He owned the company so it resulted in basically no profit for the business and a massive contribution to his IRA. He found an attorney to process it all for him and then bragged he had a multi million dollar IRA. Quote Link to comment Share on other sites More sharing options...
Jim Oh Bkkr Posted March 22 Report Share Posted March 22 There was a thread here several years ago about ROBS. It was during an economic down turn, ('08 or '09?), and people, who lost their jobs, were using 401Ks to fund start-ups. Off the top of my head, I seem to remember that the rules were (maybe) more restrictive than like/kind exchanges. But there might have been recommendations of companies that dealt with them specifically. 1 Quote Link to comment Share on other sites More sharing options...
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