From the IRS: When 'Too Good to Be True' Very Well May Be: Funding Business Startups with Plan Assets
"With recent events in the financial markets putting a squeeze on business credit, many aspiring entrepreneurs may search for novel ways to acquire business capital. One that has gained IRS’s attention, and coverage in the press, is to withdraw money from existing retirement accounts and then channel it into a new retirement plan. On October 1, 2008, the IRS released initial guidelines on the acceptability of these arrangements."
For more, read here.
