About Self-Direction
8 articles
What is a self-directed retirement plan?
A self-directed retirement plan is one where you choose the investments rather than having a fund manager or robot manage your portfolio. The plan still operates under the same IRS rules as any IRA or 401(k): same tax benefits, same contribution ...
What are the benefits of a self-directed IRA or Solo 401(k)?
Self-directed plans give you the same tax advantages as conventional retirement accounts, but with two critical differences: you control what your money is invested in, and you can choose from a much wider range of assets. This means real ...
Why haven't I heard of a self-directed IRA before?
The financial institutions that administer most IRAs have no incentive to tell you about self-directed IRA plans. Banks, brokerage firms, and mutual fund companies earn fees on the products they sell, which include stocks, bonds, funds, and ...
What is checkbook control?
Quick Answer Checkbook control means you sign the contracts and write the checks for your retirement plan investments, without relying on a custodian. You achieve this by creating a special-purpose LLC or trust owned by your IRA, giving you direct ...
What is the difference between a Custodian and a Facilitator?
A custodian is the regulated financial institution that holds your IRA and reports to the IRS. A facilitator is a service provider that builds the legal structure giving you checkbook control over plan funds. The custodian holds your retirement ...
What assets can I invest in with a self-directed IRA?
A self-directed IRA can invest in a wide array of assets. The IRS does not publish a list of approved investments. Instead, the tax code identifies a short list of prohibited assets. Anything not on that list is allowed, provided you follow the rules ...
Is Checkbook Control legal?
Yes. The IRA LLC and IRA Trust structures used for checkbook control are legal and have been in continuous use since the early 1990s. The IRS is fully aware of these arrangements. Compliance depends on how the structure is used, not the structure ...
Do I need a custodian?
Yes. All IRA plans are required by law to have a custodian. This is a non-negotiable feature of the IRA structure under IRC Section 408. What matters is understanding what the custodian actually does, and what they do not do. What the custodian ...