I would like to use the money in my IRA for the purpose of purchasing real estate, and I’ve been told I can do it with a self-directed IRA LLC account. Is it possible? The answer is, yes it is …

The IRA can contribute all the cash or a portion of its cash into an LLC wholly owned by the IRA. The direction of your IRA funds as initial capitalization of the LLC does not constitute a disqualified transaction.

Since the self directed IRA owns the IRA LLC, IRA funds can be transferred to the IRA Company in exchange for member units or shares of the LLC. After this funding, both traditional and non-traditional investments may be purchased by the IRA-LLC.

A Key Point to Consider

When owning real estate inside an IRA, all expenses must be paid by the funds in the IRA-LLC account. If you pay out-of-pocket for such expenses as contractors, appraisers, plumbers, taxes or landscapers, then you can open your IRA up to penalties, fees, and taxes starting at the beginning of the year in which you made the mistake.

Assets consolidated under the LLC become the sole asset of the account holder’s self-directed IRA. Once your IRA LLC has been funded, your IRA statement from the custodian will simply reflect one asset, i.e., the LLC. If structured properly, your IRA LLC should not pay any transactional, asset or holding fees, and why should you should it? After all, you are truly self directed and you are the one cutting the checks and paying the bills directly with your IRA checkbook.

The management of a self-directed IRA is a skill the investor can easily learn. Checkbook control of your IRA is something that every savvy investor should consider.

Begin the process of setting up your IRA LLC and feel free to call us at (877) 339-4559. Our company will complete the necessary agreements to complete the process for you.