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You qualify for ROBS if all of the following are true:
1

You have at least $50,000 in eligible pre-tax retirement funds

Eligible account types:
  • Traditional 401(k)
  • Rollover IRA
  • Traditional IRA
  • SEP-IRA
  • SIMPLE IRA
  • 403(b)
  • 457
Not eligible for ROBS rollover:
  • Roth 401(k)
  • Roth IRA
Only pre-tax retirement funds can be rolled into a ROBS structure. Roth accounts have already been taxed and use a different distribution mechanism.
2

Your retirement funds cover at least 50% of your funding gap

The funding gap is the difference between your total capital needs and any cash you plan to invest personally.Example: If you need $200,000 in capital and have $50,000 in personal cash, your funding gap is $150,000. You’d need at least $75,000 in eligible retirement funds (50% of $150,000).If your retirement funds can cover the full calculated gap, the ROBS structure may cover the primary capitalization need. You still need alternative funding sources or reserves outside the rollover for expenses and obligations that should not be funded from plan assets. If retirement funds cover 50–99% of the gap, you may still qualify but will need to supplement with other capital sources.
3

You will be a working owner and employee

ROBS requires you to be a bona fide W-2 employee of the C-Corporation. You must be actively working in the business, satisfy the plan’s service requirements, maintain records that support your service, and receive reasonable compensation for services performed.
This is not a passive investment structure. The founder must be a working owner of the company and receive reasonable compensation. Not paying yourself a salary creates its own compliance issues.
4

Your business will be structured as a C-Corporation

ROBS requires a C-Corp because only C-Corporations can issue stock that a 401(k) plan can purchase. LLCs, S-Corps, and sole proprietorships do not qualify.If you haven’t formed your entity yet, that’s fine - Nexus coordinates C-Corp formation as part of the setup process.
5

The company will operate as an active business

The ROBS structure depends on the C-Corporation qualifying as an operating company. Passive investment vehicles and companies that do not conduct active business operations are not a fit.

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Quick Eligibility Check

RequirementMinimumYour Status
Eligible retirement funds$50,000+Check your most recent statement
Funding gap coverage50%+(Capital needed − Cash available)
Working owner commitmentYesBona fide W-2 employee; not passive
Entity typeC-CorporationWe help with formation
Operating company statusRequiredActive business operations

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Edge Cases

You can combine funds from multiple eligible accounts. Each account rolls over separately into the new 401(k) plan. The $50,000 minimum is based on your total eligible funds across all accounts.
Outstanding loans reduce your available balance. If your current 401(k) balance is $80,000 but you have a $25,000 loan, your eligible funds are $55,000 (the vested amount minus the loan). Loan balances must typically be repaid or offset during the rollover.
If you’re still employed at the company sponsoring your current 401(k), you may need to check whether the plan allows in-service rollovers. Many plans restrict rollovers until you separate from the employer. If you’ve already left that employer, this isn’t an issue.
Below $50,000, ROBS typically isn’t cost-effective given the setup and ongoing administration fees. You may want to explore SBA microloans, personal savings, or other funding options.

Start Your Application

Ready to proceed? Start the ROBS eligibility screening.