The IRS released a memorandum in Oct 2008 discussing a particular retirement plan investment strategy whereby retirement plan assets (usually 401(k) assets) are invested in stock of a start up company. The idea behind the strategy is to use your retirement assets to capitalize a start-up business without having to cash out the retirement plan (and pay taxes and early distribution penalties). The memorandum raises significant concerns with the strategy and makes clear the IRS's position that implementing the strategy could be very problematic for the taxpayer.
The IRS released a memorandum in Oct 2008 discussing a particular retirement plan investment strategy whereby retirement plan assets (usually 401(k) assets) are invested in stock of a start up company. The idea behind the strategy is to use your retirement assets to capitalize a start-up business without having to cash out the retirement plan (and pay taxes and early distribution penalties). The memorandum raises significant concerns with the strategy and makes clear the IRS's position that implementing the strategy could be very problematic for the taxpayer.
