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|Subject: Re: Use 401K as collateral?||Date: 8/16/2011 11:52 AM|
|Author: gdett2||Number: 278 of 297|
I have been away from this thread for a while.
So, at this point your $2M 401K is now invested in a business. How is this going to pay the bank loan?
Proceeds from the business will be taxable for federal and state corporate rates.
I do not see anything here that I have learned about 401Ks other than there are a number of ways to make them complicated.
If I wanted a business to run in the future, this method is a way to do it, but I believe there is more to it than this very brief explanation. Also, I wonder if there is an additional tax consequence to selling the business in the future.
If this scheme was so simple and was a guaranteed tax dodge, nearly everyone would do it.
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