Learn About Business Funding

Congratulations on deciding to look more into funding your business. This section of the site will help answer some of your questions about the funding process. For an overview of the funding process, we suggest you start on the Get Funded page.

If you have any questions at all, please don’t hesitate to give us a call at (817) 381-8907 or contact us via the Have Questions? form on this page.

Third Party Administration (TPA) Services

In a franchise or independent business, every benefit creates a position of competitive advantage. Tenet Financial Group offers you Qualified Retirement Plan Consulting and Pension Administration Services in an economical and customized approach, making it possible to seize every opportunity to build a formidable franchise or independent business.

Plan Design and Installation

Tenet Financial Group can provide you with our pre-approved volume submitter documents for developing your qualified retirement plan for faster and more convenient implementation. Our consultants can personally work with you to assist in the plan design, ensuring that the plan reflects your business specifications and objectives.

Take-Over of Existing Plan

We will review your plan documents, participant communication materials, and prior administration reports to interpret your plan provisions and ensure a smooth transition. This enables us to determine if any amendments are required for plan compliance and allows us to make recommendations regarding improvement.

On-Going Annual Administration

Tenet Financial Group provides all on-going annual services, including mandatory testing to demonstrate compliance, participant statements, employer reports, and signature-ready 5500 series tax forms for the IRS.

General Consulting

Retirement laws are complex in nature and, as such, we believe it is necessary to have an open line of communication with you to provide understanding of the provisions and governing regulations concerning your plan. Our consultants are highly-trained and invest considerable time working with the Internal Revenue Service, the Department of Labor, and the Pension Benefit Guaranty Corporation, the governing agencies that regulate all employee benefit plans.

Self-Directed 401(k)

A Self-Directed 401(k) is becoming the preferred method of financing new businesses or recapitalizing an existing business.

Self Directed 401(k) Plan Design

In designing a Self-Directed 401(k) retirement plan, your organization’s primary objectives are taken into consideration to tailor a Self-Directed 401(k) plan that includes all tax benefits for your franchise or independent business. The design phase includes informal discussions to identify specific needs and requirements, budgeting restraints, and basic provisions. Tenet Financial Group can customize a Self-Directed 401(k) plan, using prototypes we have developed for easier facilitation, or amend a pre-existing plan. The following steps are taken in designing a Self-Directed 401(k) Plan:

Overview of your organization’s history, type of business, management objectives, personnel policies, employee termination or turnover experiences, and any human resource factors that might affect the plan
Interpretation of employee information (provided by your organization) to determine benefits and contributions under different plan strategies
Review of allocations using various formulas and benefit projections for defined contribution plans
Determination of government compliance of the plan (if customized)
Design of plan specifications such as eligibility, vesting options, benefit or allocation formula, retirement dates, and distribution methods.

Self-Directed 401(k) Plan Installation

Before you implement a new or amended Self-Directed 401(k) plan, the plan must be submitted to the Department of Labor (DOL) and the Internal Revenue Service (IRS) for approval (qualification) to assure the plan is qualified. Tenet Financial Group’s Self-Directed 401(k) plan has been pre-approved by the IRS. The qualification process is necessary to make the plan and trust operative as well as guarantee initial plan approval under the appropriate IRS Code Sections. During Self-Directed 401(k) plan qualification and implementation the following occurs:

Preparation of IRS qualification and Department of Labor approval documents (Form 5300 Series, Form 5302, Form 2848, Form SS-4)
Consultation as necessary with the Internal Revenue Service or the Department of Labor
Preparation of a Summary Plan Description of major plan provisions for employee distribution.

Self-Directed 401(k) Administration

Tenet Financial Group provides continuous Self-Directed 401(k) administration. These services include annual administration, determining eligible participants, additional benefits, allocation of contributions, compliance testing, maintenance of plan records, administration reports, and consultation with your accountant, attorney or financial advisor.

Administration reports can be furnished annually, semi-annually, or quarterly depending on request. Administration services may include:

Calculation of minimum required and maximum tax deductible employer contributions. “Top-Heavy” testing is performed to satisfy compliance for plans that primarily benefit key employees (60% of benefits) and must meet requirements on minimum contributions and accelerated vesting
Preparation of Allocation Reports (defined contribution plans). Inclusions consist of summaries and plan financial statement similar to the Valuation Report listed above
Determination of minimum participation, coverage, and discrimination testing
Preparation of Average Deferral Percentage (ADP) and Average Contribution Percentage (ACP) tests for all 401(k) plans. The ADP and ACP are non-discrimination tests. The amount of contribution for highly-compensated employees is limited by the average deferral package contributed by non-highly compensated employees under these test rules
Calculation and preparation of the vested balance and necessary disclosure forms for employee status changes (due to retirement, termination, disability, or death) for submittal to the employee. Distribution statements and 1099-R forms will be furnished for benefit distributions
Reconciliation of employee census information and plan financial statements
Perform an annual compliance review of written plan with actual plan operation goals and objectives.

Risks and Considerations

As with any financial decision, certain considerations and risks must be considered. Tenet Financial Group is committed to helping all of our clients understand these before moving forward with ROBS/401(k) Rollover Funding.

Investment Risk

Investing retirement dollars into a new business venture is an inherent investment risk, much like investing in other businesses via the stock market, for example. If the business fails, the retirement dollars used in the ROBS process to fund the business will not be recouped. Tenet Financial Group clients are encouraged to carefully assess your risk tolerance and ability to cover costs if unforeseen issues arise. Tenet Financial Group will help you understand your level of risk to find out if ROBS funding is the right fit for you.

Costs

ROBS plans with Tenet Financial Group cost an initial set-up fee of $4,995 and an additional $1,620 (approximated) per year to administer the plan (plan maintenance, compliance, reporting, etc.). Additional annual associated fees, such as Business Valuations, should also be considered when reviewing ROBS as a means of business funding.

Additional IRS and DOL Reporting, and Plan Administration

401(k) Plans are monitored for compliance by the Department of Labor (DOL) and the Internal Revenue Service (IRS). The DOL focuses on employment rights issues whereas the IRS enforces tax compliance. With a ROBS arrangement, you will have additional reporting requirements to the DOL and IRS, however you can rely on your Tenet Financial Group ROBS plan administrator to ensure you are in compliance every year.

As a leading Third-Party Administration (TPA) of thousands of ROBS plans, we understand the importance of keeping a C-Corporation and its ROBS plan compliant with IRS requirements. No client of Tenet Financial Group has ever been audited by the IRS due to our thorough, consistent review and administration of the plan. For example, Tenet Financial Group will help you stay compliant by completing and submitting the Form 5500 and all associated schedules on time, ensuring you extend plan benefits to all eligible employees, and properly value the plan assets on an annual basis.

Franchise/Business Funding Partners

Considering purchasing a franchise? Many successful business owners have chosen this route as well. When you buy a franchise, you buy instant name recognition, saving you a ton of time and money trying to start from scratch. Franchises have also perfected the techniques and skills required to deliver your products and services in a way that nets you the most profit.

If you’re wondering if franchising is a good fit for you, browse franchise opportunities at BizBuySell to see what’s available.

It’s easy to get started. After you register, you’ll be able to request more information about your favorite franchises and talk with a franchise consultant about the details.

Once you’ve made your decision, contact Tenet Financial Group and we will help you find business funding.

If you know what franchise you’d like to purchase, give us a call at (817) 381-8907 and we’ll get you connected to a professional who can help you right away.

How Does This Work?

401K Rollovers