Explore the 1,000’s of tax questions answered by professionals.

Back to list


Related User


I currently have funds invested in a 401(k) through my employer. I wish to use these funds to purchase stock in an S-Corporation. I was wondering what is the best way to do this? I am aware that a self directed IRA cannot purchase shares of an S Corp. I was curious if there is any other way of setting it up so that I can use these funds?


Expert Joseph Caplan's Answer:

There really is no way to distribute the funds with the intention of forming a business without being penalized and taxed. You can withdraw the funds penalty-free for a limited number of reasons (ie. purchase of a new home, college expenses, medical expenses, etc.)

Joseph Caplan, CPA

New York

9 yrs experience

  • Currently 4.0000/5 Stars.
  • 1
  • 2
  • 3
  • 4
  • 5
14 Ans.