For general information on IRA's (Individual Retirement Accounts) visit the following sites:

The IRS link to Publication 590-(IRAs), which covers many issues related to IRAs.

The Kiplinger website provides basic IRA information.

Based on consultation with McHenry Consulting, IRAs and plan assets can't collateralize personal loans under spendthrift provisions, but rolling-over a distribution into a (k) plan would allow the owner to:

• Take out a loan against his plan assets to buy personal property (the company) controlled by a plan fiduciary (probably himself) operating under the exclusive benefit rules (acting "solely in the interest of the participants... for the exclusive purpose of providing benefits to participants"). He may avoid the tax/penalty cost of IRA liquidation, but it may constitute an indirect loan from an entity related to the issuer (the plan), which would violate Sarbanes-Oxley. There are actually some companies out there considering amending their plans to BAN loans to executives.
• Convert to K-sop and buy the biz with a combination of deductible employer contributions and plan loans.

However the transactions are problematic and either one would be picked up in audit. McHenry Consulting's website.