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About Self-Directed IRAs

Free Guide-SDIRA

 

What is a Self-Directed IRA (SDIRA) ?

Self-directed IRAs are retirement accounts that you control. You don't check off a box to indicate your investment choices in stocks or mutual funds like you do with any account managed by a brokerage firm or financial institution. You get to directly pick, buy, and sell the assets held in your account— alternative assets like real estate, notes, and private equity

With a self-directed IRA, you have the freedom to invest in a broad array of investments, as long as the investment is not prohibited by the IRS. Your imagination is the only other limitation.

When you open a self-directed IRA at IRAR, you save on annual fees and take advantage of a wealth of knowledge. Our team has helped self-directed investors for over 25 years and understands the rules, transactions, and makes the process easy for you.

 

What are the benefits of Self-Directed IRAs?

 

Diversified Retirement Portfolio

The freedom to diversify your retirement savings gives you more protection from the volatile stock market. In turbulent markets, you won’t fall behind on your retirement goals.

 

Full Control of Investment Choices

You have the freedom to invest in an array of investments that’s broader than what a typical brokerage firm offers. This includes non-traditional, tangible assets that you understand and may be familiar with, taking advantage of your expertise to build wealth faster.

Tax Benefits

A self-directed IRA has all the tax benefits of IRA accounts or regular IRAs at a broker-dealer. Depending on the type of account (Roth IRA vs. Traditional IRA) your investments grow tax-free or tax-deferred. You can craft your own retirement strategy.

 

 

Everything you need to know
before getting started with a Self-Directed IRA;
strategy, rules, and more!

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What can I invest in with my Self-Directed IRA?

 

Real Estate IRA

Real Estate

From single-family rentals to commercial properties like storage units, all real estate and related assets are allowed in a self-directed IRA.

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Private equity IRA

Private Equity

Self-directed IRAs can invest in privately held companies, startups, hedge funds, LLCs, or stock that is not sold in the open, public market.

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Mortgage Notes IRA

Notes

Your IRA can lend or extend credit to individuals and companies. It can also buy notes from brokers or private parties secured by collateral. Your have many investment options.

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Alternative Investments in IRAs

Other Alternative Assets

A well-diversified retirement portfolio can weather any storm. The types of investments that are allowed in self-directed IRAs are countless. 

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Self-Directed IRA rules

 

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Investments not allowed in self-directed IRAs

It comes as a surprise to many people that there is no list of approved investments for retirement plans. However, the IRS does have a list of what the law does not allow as an investment. Self-directed IRAs cannot invest in:

  1. Collectibles: Art, antiques, gems, coins, or alcoholic beverage, and certain precious metals
  2. Life insurance: (See IRC Section 408(a)(3))
  3. S-Corporations: Trusts that qualify as an IRA are not eligible to be shareholders of an S-Corporation. (See Revenue Ruling 92-73)

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not allowed

Prohibited transactions in self-directed IRAs

With a self-directed IRA, there's a lot of flexibility when it comes to investments— but there are some limitations as to who your IRA can do transactions with.

Your self-directed IRA can't engage in transactions with anyone the IRS considered a disqualified person to the IRA.  Otherwise, you lose the tax-deferred status of the account.

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prohibited transactions

Examples of prohibited transactions in self-directed IRAs

  • You buy the house you live in with your IRA
  • Your child moves in to your IRA-owned rental
  • You pay yourself commission for the purchase of your IRA's investment
  • You invest in a company owned 100% by your daughter
  • You buy a company previously owned by you and your spouse

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Fees associated with Self-Directed IRAs

Fees have a big impact on retirement accounts, they slowly add up over time. Some custodians increase their fees as your assets grow in value. This defeats the purpose of saving for retirement. At IRAR, you save over 50% compared to most providers. 

Here are the most common fees associated with Self-Directed retirement accounts and Real Estate IRAs.

Account Establishment

IRA custodians usually charge an account-establishing fee to open your account. This is usually a one-time fee.

IRAR charges $100

Annual Recordkeeping

All providers don’t charge the same. These fees can be based on the value of the account or per asset. 

IRAR charges a flat fee $199

Transaction Fees

Most custodians charge a fee for processing specific transactions.  Beware of the all-inclusive fees, usually there is a catch!

See fee schedule

Compare Self-Directed IRA fees and providers
Don't overpay for your Self-Directed IRA

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What is the process to open a Self-Directed IRA?

 

Institution

Choose a custodian to establish your account

With a truly self-directed IRA, your administrator or financial institution is not a bank or a brokerage firm.  It’s a custodian or trust company like IRAR that specializes in alternative investments in IRAs.  It's very important to conduct due diligence and learn how custodians are regulated and the difference between the many companies that offer these services.

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Documentation

Select an account type that is right for you

Choose an account based on your goals and tax advantages. Depending on your income and eligibility, as well as account type, your IRA contributions may qualify as tax-deductible.

Individual Retirement Accounts

Small Business Plans


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Funding self directed IRA

Fund your account

Moving your retirement account from one custodian to another is easy and you do not incur taxes or penalties when you do it properly. If you have never established an IRA, you can start by opening an account with a contribution. Once your account is funded, you can start investing.

How to transfer or rollover funds and/or assets

 

Got Questions?

Schedule a FREE consultation with one of our self-directed IRA experts or give us a call 888-322-6534.

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