Self Directed IRA to start a business
My understanding is that you can use a self-directed IRA to start a business (LLC or Corp). However, if the IRA owner intends on working themselves in that business on a daily basis, it would seem to me that that would be self-dealing. They are at least getting an indirect benefit from this. Any opinions on this matter?
Permalink Submitted by mk foss on Wed, 2010-12-29 23:42
Use an IRA to start a business at your peril. There are many opportunities for self-dealing and/or exposure to unrelated business income tax. IRS has issued warnings about ROBS – Roll Overs as Business Start-ups because they’ve been advocated aggressively and IRS doesn’t agree with the information being shared about them.
Permalink Submitted by Edward Lustberg on Thu, 2010-12-30 00:29
Thanks for the info. I have been searching for that IRS memo, no luck. Would you happen to know where I could find it?
Thanks,
ED Lustberg
Permalink Submitted by Alan Spross on Thu, 2010-12-30 01:11
Ed,
No luck here either – several links to the original release a couple years back are dead, so the IRS must consider the Notice to be extensively revised. Here is a related article:
http://www.dannamckitrick.com/beyond-the-fine-print/2010/06/robs-transac…