Self-Directing Your IRA
Most people have heard of an IRA before, but are not familiar with the self-directed IRA. Despite the self-directed IRA being unfamiliar, it’s actually been around for over 30 years.
What is a Self-Directed IRA?
The self-directed IRA is not that much different from the traditional IRA. The only difference between the two is that the self-directed IRA provides you with the ability to self-direct your retirement funds into alternative assets, including equity trusts, real estate, and tax certificates and much more.
There are a number of benefits for using a self-directed IRA, including some of the benefits you get for regular IRA. These include tax-free profit, deductions, asset protection and estate planning.
Steps to Self-Directed IRA Investing
Before you can start with your self-directed IRA, you will need to identify the investment you want to make. Once you have found a viable investment, you will need to acquire the necessary funds. Any documents you acquire and use during this process, must be in the name of the IRA.
When the equity trust has received your application forms, the investment can be processed. When the forms have been completed and accepted, funds will be sent from your IRA. All documents and records will still be kept by the Equity Trust.
Investors who are ready to sell their investment must complete a so-called investment form. This form tells the Equity Trust to remove the investment from their account. Once the investment has been sold, the profits will end up in your self-directed IRA. The beauty of this is that no taxes will be imposed on this investment.
Self-directed IRA investments are definitely worthwhile, especially due to the fact that they are accompanied by so many benefits. Any investor can greatly benefit from this process.
Disclaimer: The Company introduces general information and education concepts about self-directed retirement accounts (such as 401(k) and IRA accounts). Like any investment, there is risk in using retirement funds for investing in real estate assets. It is possible to lose a portion or all of an investment in real estate – including those purchased with retirement funds. Please review IRS Publication 3125 regarding the use of retirement funds for alternative investments. The document can be found at: http://www.irs.gov/pub/irs-pdf/p3125.pdf. Every individual is different, with unique circumstances. We do not offer tax, accounting, financial or legal advice. Prior to acting upon this information, you may consult your own accounting, legal and financial advisors to evaluate the risks, consequences and suitability of that transaction. The Company is not a retirement account custodian, trustee, or securities dealer.