I am considering using the 401(k) Business Financing (ROBS) structure to fund a franchise startup. The problem is, I am an entrepreneurial spirit and I feel that I will ultimately end up starting at least two different franchises, perhaps more, as earnings flow back into the 401(k). I have one 401(k) to roll over. Am I able to create a C Corp holding company funded by the 401(k) that will then start the different franchises as LLC subsidiaries? I assume that in order to not get in trouble with the DOL that even though most of the employees are employees of the individual LLCs they all should have access to the 401(k) of the holding company, correct? Thank you for your time. I don't want to get off to the wrong start.
ANSWER:
1) Yes - the C corp that is funded with your retirement funds can certainly operate different lines of business that it operates through different 100% subsidiary LLCs.
2) Yes - the employees of the LLCs will be considered employees for purposes of the plan.
1) Yes - the C corp that is funded with your retirement funds can certainly operate different lines of business that it operates through different 100% subsidiary LLCs.
2) Yes - the employees of the LLCs will be considered employees for purposes of the plan.