ROBS Arrangements

Our attorneys are uniquely experienced and highly regarded in working with employers who want to utilize an exception to the prohibited transaction rules commonly referred to as a “Rollover as Business Start-Up” (“ROBS”).  The transaction involves rolling qualified retirement savings, usually a traditional IRA, into a new retirement plan to capitalize a corporation that will operate the new business.

The plan’s investment in company stock, known as qualifying employer securities, or “QES,” can provide the ROBS owner a significant amount of funds for the start-up or acquisition. However, the transaction and subsequent plan sponsorship require careful attention to complex tax and retirement plan regulations.

We provide advice in ROBS transactions regarding:

• Requirements for a compliant ROBS arrangement
• Valuation of the QES–when, how, why
• ROBS exit strategies, including treatment of gain as “net realized appreciation”
• Help correcting ROBS mistakes, plan failures, and prohibited transactions
• General retirement plan compliance, irrespective of the ROBS feature, which is often challenging for start-up companies