What you should know about checkbook LLC for IRAs.
Checkbook IRAs - Single Member LLCs or Checkbook IRAs are an option for investors. With these, the client's IRA is appointed the member of the LLC and owner of the account is appointed the Manager. The manager now has control of the “Checkbook” for the IRA, giving the IRA owner the ability to write checks and deposit funds like rents. Are Checkbook IRAs necessary? This is an important discussion to have with your personal tax advisor. Most clients own one to two assets that do not require the additional cost or administration of the Checkbook LLC. When clients want to own multiple real estate assets or buy assets like tax certificates, we have observed that a checkbook IRA can be a useful tool to help manage/administer the assets. Please remember even if you have a Checkbook IRA, you will still need an Administrator to hold the membership interest in the LLC on behalf of your IRA. Finally, there has always been a question as to the legality of Checkbook IRAs. The Swanson Case is the guiding principle behind Checkbook IRA and the case does not actually rule on whether Checkbook IRAs are legal. To see the Swanson Case CLICK HERE. Entrust does not endorse the use of Checkbook IRAs.
Call us 866-836-0429 for more information regarding Self-Directed Retirement Accounts.
Call us 866-836-0429 for more information regarding Self-Directed Retirement Accounts.