Rules & Guidelines
Self-Directed Individual Retirement Accounts provide a great deal of freedom, flexibility, and a wealth of investment choices. However, they are also governed by a set of rules that investors need to be aware of. These rules are put in place by the IRS to ensure that your retirement plan benefits your retirement plan, not you personally. Be sure you understand these rules and how to properly utilize your tax-advantaged account. In addition, you should always consult your attorney, tax, and/or investment professionals regarding your investment decisions.
Some types of self-directed transactions violate the basic intent of your IRA, and may subject your account to risks and penalties. Your retirement plan is intended to benefit you when you retire and not before. Transactions that can be interpreted as providing immediate financial gain to the account holder or other disqualified persons holders are not allowed. Examples include:
- Borrow money from the IRA
- Sell, exchange or lease personally owned property to their IRA
- Receive unreasonable compensation for managing property held by the IRA
- Use their IRA as security for a loan
- Transfer plan income or assets to disqualified persons
- Lend IRA money to disqualified persons
- Extend credit on their IRA to disqualified persons
- Furnish goods, services, or facilities to disqualified persons
- Allow fiduciaries to obtain or use the plan’s income or assets for their own interest
Who are the Disqualified Persons?
- The IRA holder and his or her spouse
- The IRA holder’s lineal descendants, ascendants and their spouses
- Investment advisers and managers
- Any corporation, partnership, trust, or estate in which the IRA holder has a 50 percent or greater interest
- Anyone providing services to the IRA, such as the trustee or custodian
Prohibited Investment Types
You may NOT invest your Self-Directed IRA funds in life insurance products or collectibles, which include works of art, rugs, antiques and alcoholic beverages. You may invest your IRA in precious metals, but the metal must be an approved metal meeting certain fineness requirements.
With a self-directed IRA from Midland, you can invest your retirement funds when, where, and how you want. Create your financial future with the freedom to make choices with your retirement plans. Self-directed IRAs give you the unique ability to choose from a variety of investment options, and by truly diversifying your investments, you may protect and enhance your retirement. Get started by calling us today. Invest with IRA
PENSCO is the leading alternative asset custodian, with more than two decades of expertise in holding private equity, real estate, notes, and other non-exchange traded assets. We possess knowledge and experience with IRS rules and regulations for holding alternatives in IRA, and we are dedicated to continuing to innovate technology to streamline the alternative asset investment process. Our services don’t end with individual investors, though. PENSCO Trust also provides solutions and services to Registered Investment Advisors, financial planners, investment sponsors, crowdfunding platforms and professional service providers seeking an alternative asset custodian for their clients. Invest with IRA