The IRS successfully challenged a ROBS (rollover as a business startup) transaction involving an ESOP in Fleming v. Commissioner, T.C. Memo. 2015-224.   A doctor rolled over IRA benefits to an ESOP.  The facts were peculiar, in that the company was prohibited from competing for a period of years following the ROBS transaction.  The IRS challenged the transaction on a number of bases, and succeeded with respect to each one.  ROBS transactions are very dangerous, particularly when an ESOP is involved.  (Generally, a ROBS transaction involves taking IRA funds and investing in a newly formed business in which the business creator will be the sole participant in the plan.)