If I’m the trustee of the 401(k) plan and the president of the corp. (which is owned by the retirement plan), can i loan money to the corp. Or is that a prohibited transaction? Thanks!
Unfortunately, I think this would be classified as either a self-dealing prohibited transaction or a conflict of interest prohibited transaction from the regulation on retirement accounts. You can’t use 401k funds that you’re the administrator of and loan them to a business you own. You would be forced to charge interest, or it would be a gift, and this means you would personally profit off of the transaction. This wouldn’t be fair to any employees you might have who are investing with you, and it isn’t in line with the whole point of a ROBS.