In-Service Distributions: Checkbook Control Solo 401k, SDIRA & QRP

Checkbook Control QRPs, 401(k) plans, and SDIRAs are powerful vehicles for investing in alternative assets classes, including: real estate, raw land, private loans, hard money loans, private businesses, tax certificates, cryptocurrency, crowdfunded investments, foreign & overseas assets, and so much more.

Getting access to and rolling over funds from your employer-sponsored 401k to a Checkbook QRP, Solo 401k or Checkbook IRA is doable in many instances, but you’ll have to overcome some obstacles to do so. With the knowledge provided in this post, you’ll be prepared to get the results you want.

Unlock Your Employer 401(k) to Get Customized Checkbook Control Continue reading “In-Service Distributions: Checkbook Control Solo 401k, SDIRA & QRP”

Private Lending IRAs: The SDIRA Checkbook Retirement Account Advantage

Private Lending IRAs and Checkbook Control

Private lending is the ideal investment for an IRA…and less than ideal outside of an IRA.

Understanding why that’s the case – and why a checkbook control IRA is crucial to maximizing private lending investment returns – requires an understanding of tax and investment concepts. In this post we’ll cover the income tax treatment of private lending inside and outside of retirement accounts (IRAs, Solo 401k plans) and why a Self-Directed IRA with Checkbook Control is the IRA you need for private lending. Additionally, if you’re a real estate investor, you’ll learn how to get funding for deals by leveraging the IRAs of private lenders. Continue reading “Private Lending IRAs: The SDIRA Checkbook Retirement Account Advantage”

Beyond Prohibited Transactions: The Step Transaction Doctrine

Mastery of the Prohibited Transaction Rules of IRC 4975 may lead the self-directed investor to contemplate some clever deal structures to work around those.

Suppose you own an income producing property that you’d like your Solo 401k or Checkbook IRA to purchase, but knowing that as a “disqualified person” you can’t transact with your IRA you initially conclude that it can’t be done. Suddenly, you experience an epiphany – you could transfer title to the property from your name (or your LLC’s name) to your brother’s name, and he would subsequently sell the property to the self-directed retirement account. Eureka!

That stroke of brilliance has been had by many others and the courts have developed some judicial doctrines to analyze and characterize such transactions. One such doctrine is known as the Step Transaction Rule. Continue reading “Beyond Prohibited Transactions: The Step Transaction Doctrine”

Beyond Prohibited Transactions: The Plan Asset Rule

Checkbook QRP,  self-directed Solo 401k and checkbook-control IRA investors are aware (I hope that’s true) of the Prohibited Transaction Rules and Disqualified Persons discussed in IRC 4975. So, if you’re familiar with IRC 4975 are you covered? Or, do you need to know more than that to stay in compliance and protect your assets?

The Plan Asset Rule

There’s a lesser known extension of IRC 4975 in the Code of Federal Regulations that discusses something known as the Plan Asset Rule. In a nutshell, the Plan Asset Rule says that when retirement plans own a “significant” share of an entity, all of that entity’s assets are treated as assets of the retirement plans for purposes of the prohibited transaction rules.

The implications of this can be staggering; if retirement plans collectively own a significant portion of an entity, all the disqualified persons of all the retirement plan investors are disqualified persons to that entity. Continue reading “Beyond Prohibited Transactions: The Plan Asset Rule”

Beyond Prohibited Transactions: The Exclusive Benefit Rule

Among the first concepts introduced to self-directed IRA and Solo 401(k) investors are “prohibited transactions” and “disqualified persons.” While those are certainly key concepts, there are several others to be aware of; among those is the “Exclusive Benefit Rule.” Continue reading “Beyond Prohibited Transactions: The Exclusive Benefit Rule”