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
Take-Over of Existing Plan
On-Going Annual Administration
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
- 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
- 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
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.
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.
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.
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.