This IRA is not your Father’s IRA! (why you might want a PGI Self-Directed IRA)
- 1) Receive assistance in selecting an IRA custodian that is best for you. There are differences, to be sure.
- 2) Creation of the IRA LLC – If the LLC is not properly established it can cause your IRA to be fully distributed…which means full taxation and potential penalties.
- 3) Specialized Operating Agreement — gives you legal and well-defined instructions on the manner in which your IRA LLC will operate. You have to know the proper rules to operating the LLC.
- 4) Ongoing advice – Anyone can establish an LLC. However, PGI can provide the beginning and on-going assistance with regard to the establishment and operation of your IRA LLC. The potential penalties for plans operating contrary to IRS regulations can reach $200,000.
- 5) Checkbook control — You will have checkbook control of your IRA LLC. You are now going to have the totaly freedom and flexibility to invest within IRS rules and how you want. You will never again be “held captive” by someone else.
- 6) Asset Protection – What is the purpose of building up a large nest egg if it can be successfully attacked by creditors and others? Learn how to have ultimate asset protection of your IRA LLC funds. With the LLC you have an additional layer of asset protection.
- 7) Updated information – the tax codes are constantly changing. In the last year there have been a number of fines and penalties, to the tune of hundreds of thousands of dollars, added to the code to penalize those who are unaware. Our role is to make sure you are educated.
The Family IRA
The Family IRA can be used when the desired investment is too large for your IRA to purchase alone. In the below illustration, Bill and Sue use their IRAs to buy a prorated interest in a third LLC. Then that third LLC purchases the property. In this strategy as in all investment strategies, structure and adherence to the IRS rules is of the utmost importance.
Checkbook Control Of Your Retirement Funds
You have heard it said that “time is money”. Never has that been more true than with investing. When a good real estate deal comes along, you can not afford to take weeks to act. With a typical bank or brokerage IRA it can take a few days to a few weeks before you receive a check out of your IRA. Why? After all, it is your money that you are requesting. At PGI, we will help you with the simple yet effective steps of establishing Checkbook Control over your retirement funds. Once completed, you can simply write a check when you have the opportunity to grab a great investment. What could be simpler than that?
There are minimal reporting requirements when you establish an LLC inside of your IRA, since the LLC is by definition a “pass-through entity”. This means that all of the LLC’s gains and losses pass-through to its owner; in this case, the tax-deferred entity of the IRA. The tax-deferred structure of the IRA usually prevents current taxation.