Have the plan funded before anything else
A checkbook plan generally takes three to four weeks to establish and fund. Entity formation, the custodial account, the transfer or rollover, and the entity bank account each depend on the one before it, so the total is sequential rather than parallel.
Working backward from a published auction date, four to six weeks of lead time is realistic. An auction that lands inside that window is one to skip. The funds must sit in the plan's account under your signing authority before registration opens, and no shortcut exists that does not involve personal money touching a plan transaction.
Register the entity, not yourself
The registrant is your IRA LLC or plan trust. Any registration fee or good-faith deposit is paid from the plan account, in the entity's name.
Have these accessible before registration opens:
- Entity formation documents
- The EIN letter for the entity
- Proof of your authority to sign as manager or trustee
- The plan bank account details for deposits and refunds
Paying a registration fee or deposit personally is a prohibited transaction under IRC Section 4975, and reimbursing yourself afterward does not cure it. The amounts are often small enough to feel incidental, which is exactly why this is the step where mistakes happen.
Research parcels and fix your maximum bid
The county publishes its parcel list ahead of the sale, typically a few weeks out. Assessor records, recorded encumbrances, and delinquency history are all public and all reviewable before the auction. Tax value is not market value and should not stand in for it.
Set a maximum bid per parcel while you still have time to think, along with a total capital limit for the day. Both are decisions to make during research, not during bidding.
Pay from the plan account by the county's deadline
Payment is commonly due the same day, often by a set hour in the afternoon. Cashier's check and wire are the usual accepted forms, and both must be drawn on the plan's account. Because cashier's checks have to be obtained in advance, many investors bring several in denominations matched to their intended bids and redeposit the unused ones.
This is where checkbook control earns its place in the structure. You issue payment directly as the authorized signer, with no custodial review or processing time between the winning bid and the county's cutoff. You can manage the full auction sequence on behalf of your plan.
Take title and collect in the entity's name
The certificate or deed is issued to the plan entity. Redemption proceeds, principal plus statutory interest and penalties, are payable to the entity and deposited to the plan account. Nothing passes through a personal account at any point.
Redemption periods run from roughly six months to three years by state. A lien requires nothing during that window beyond tracking the deadline. A deed requires more attention after the sale, since recording and clearing title are separate steps and some jurisdictions effectively require a quiet title action before the property can be sold conventionally.
Certificates, deeds, receipts, and county correspondence are plan records, held by you in your capacity as manager or trustee.
Frequently Asked Questions
Can I pay a small county fee personally and get reimbursed by the plan?
No. A prohibited transaction occurs at the moment personal funds are used for a plan transaction, and reversing the payment does not undo it. Every county fee, deposit, and purchase price comes from the plan account, regardless of size.
What happens to my deposit if I do not win anything?
Counties return unused deposits, some automatically within days and others on request. The refund goes back to the plan account it came from, which is one more reason the original deposit has to originate there.
Can one plan bid in more than one county or state?
Yes. A single plan can hold positions across multiple jurisdictions, and each county's registration is handled separately in the entity's name. Taking title to real property in a new state can raise a separate question about registering the LLC there, which is worth confirming before a deed sale rather than after.