open opportunity ira
Has anyone heard of “open opportunity ira”, if so what do you know about it? I was recently asked this question from a prospect who got my name from Ed Slott’s Advisory List.
Has anyone heard of “open opportunity ira”, if so what do you know about it? I was recently asked this question from a prospect who got my name from Ed Slott’s Advisory List.
Permalink Submitted by Alan Spross on Mon, 2011-01-31 20:25
Probably just a marketing phrase for some feature. For example a bank might use a similar phrase to describe a CD that allows you to add to it at the current rate when the rate rises after you open the original CD.
Permalink Submitted by Sue Wong on Mon, 2011-01-31 20:46
no, it actually is not a marketing phrase. I did a search and there is something on this topic and after doing a little bit of research it sounds like a scheme of some sort to avoid paying taxes on your ira accounts, but gets very complicated with establishing a LLC owning part of the the IRA and discounting the IRA account due to minority ownership….My take on this is that is sounds like one of those marketing scheme to lure in high net worth individuals to set up tax avoidance but I wanted to know if anyone out there who might even have implements such a plan for individuals.
Permalink Submitted by Alan Spross on Mon, 2011-01-31 21:01
This is where a marketing phrase morphs into a marketing program or at worst a scheme. “Open opportunity” also adequately summarizes any of the various self directed IRA plans for holding alternative investments in IRAs, and not just real estate.
A self directed IRA is perfectly OK, but it is vital to use one of the major custodians such as Guidant or Pensco that has a long record of dealing with the IRS on compliance and specifically prohibited transaction issues, as well as filing a 990 in the event of UBIT on the IRA. It is the brand new approach that uses additional entities, particularly if marketed by an unknown custodian that I would worry about. We never really know in advance how much a crackdown will be levied on the custodian vrs the IRA owner. There has been some degree of sympathy toward IRA owners by the IRS in recent years due to the loss of retirement assets from the financial meltdown, but as the deficit increases no telling how long that leniency will last. There is also a tendency for the IRS to react slowly until a certain practice reaches a critical mass, and then comes the crackdown, eg the conversion of articially depressed asset values, particularly annuities back in 2005.
Perhaps someone can post specifics about this particular promotion.
Permalink Submitted by Jose Morales on Mon, 2011-01-31 23:48
It is a marketing phrase/scheme, meaning someone has attached a label to a new strategy for investing your IRA and is trying to pass it off as something newly available to the public. Here is one of many links on this “new” IRA: http://www.sovereignman.com/finance/have-an-ira-try-this/#