Earlier, AGi shared some of Intuit’s small business tips for getting started after retirement age. One of those tips talked about the recommendation to use a financial source separate from your retirement funds. At the New York Times, Josh Patrick talks about the tax implications might be if you decided to make that decision, specifically discussing ROBS — rollover as business start-up:
“…using a ROBS strategy increases the tax bite from 48 percent to a little more than 60 percent. And that’s my point: even if ROBS transactions are legal, the tax implications are significant.”
If this is relevant to you, we encourage you to read the finer points of his article. And if you’re considering using the equity on your home to start your business, we encourage you to read this post at the Small Business Blog by guest poster Brentt Taylor. Here he talks about the possible benefits with caveats:
A home equity loan can provide additional funding to get through slow seasonal periods, weather a weakened economy, or overcome an emergency set-back. There is always the option to sink additional funds into the business to help promote its growth even if it’s doing well. A home equity loan, while viable, should be held in reserve until it is truly needed.