A true self-directed IRA – the way retirement savings should be.
The IRA LLC structure is what we call a truly self-directed IRA. The terms self-directed IRA, real estate IRA, checkbook IRA, etc… aren’t even technical terms. These terms are merely used to gauge the level of control you have over your IRA and how the funds can be invested. With an IRA LLC you will have the benefits of:
- Checkbook Control
- Asset Protection
What is a Self-Directed IRA
It can be confusing when various financial institutions and IRA custodians claim to offer self-directed IRAs, yet restrict you from investing your IRA in alternative investments. Even when you find a self-directed IRA custodian who will hold your chosen investment, they may impose in-house rules, red tape and fees.
With an IRA LLC you will have all the freedoms allowed under IRA law.
The type of investments that may be held in an IRA is limited only with respect to insurance contracts, under 408(a)(3), and with respect to certain collectibles, under section 408(m)(1)
~ IRS Field Service Advice, April 2001
Aside from life insurance, collectibles and 6 prohibited (self-dealing) transactions under section 4975, a truly self-directed IRA has no restrictions, allowing you and your retirement investments to evolve and grow in the ever changing world we live in.
What is your retirement strategy?
Should you rely on others to manage your finances?
Do you fully understand where your money is invested?
What is your exit strategy?
These are all good questions to ask yourself when thinking about your retirement strategy. A self-directed IRA is not for everybody, but if you believe that you can be getting better returns than a fund manager – a self-directed IRA is a great vehicle to do it in.
To benefit from all the advantages under IRA law, don’t just pick an account that your custodian can sell products to, make sure your IRA is a true self-directed IRA.
Self-Directed IRA LLC
A self-directed IRA LLC is a modern hybrid between an Individual Retirement Account and a Limited Liability Company. The combination between these two types of legal entities will give investors iron clad asset protection, tax free growth on investments and freedom to make and maintain investment decisions and directions at will. The IRA LLC structure is by far the future of retirement investing – the New Standard IRA!
Even though the IRA LLC format has been vetted through the legal system, legitimized through case law, private letter rulings, IRS memorandums and has been openly practiced since before the Roth IRA was even an option – the concept still seems new to many investors. This is the result of the retirement industry being dominated by a market where advisors have little or no incentive to research and inform you about self-directed IRA strategies like the IRA LLC.
An IRA can invest in private companies and investments just like it can publicly traded companies. IRA rules are exclusive rather than inclusive, so there isn’t a long list of investments that are permissible but instead there is a short list of investments that are prohibited. A self-directed IRA LLC is an excellent solution to problems that come with self-directed IRA custodians, i.e. title issues, timing restraints, paperwork and fees.
IRA Fees – Reduced
With a self-directed IRA LLC you are essentially just making one investment and holding one asset – an IRA LLC. This can cut the fees down to the bare minimum. IRA custodians usually only charge $100-$200 a year to hold an IRA LLC. Self-Directed IRA custodians act as a passive IRA custodian, so they will typically charge nickel and dime fees for everything they do. IRA custodian fees can be assessed for:
- Writing Checks
- Registering Assets for your benefit
- Liquidating Assets
- Re-Registering Assets when they are sold
- Holding Assets for your benefit
- Wiring Funds
- Expediting Documents
- Delivering Documents
- Looking at a document (research)
- The list goes on