Discover the Benefits of a Tax-Free or Tax-Deferred Self Directed IRA

1. Realize Higher Returns on Investments

Retirement accounts provide the opportunity to save money for the future in a tax-free or
tax-deferred environment. However, a Self Directed IRA or may allows you to benefit in a
variety of alternative investments with the potential to earn even more.

Retirement plans for individuals come in all shapes and sizes. The most popular include
traditional IRAs and Roth IRAs. For small businesses, 401ks, SEP IRAs and SIMPLE IRAS
are common. In addition, there are savings plans for special needs, such as Coverdell
education savings accounts and health savings accounts

Individuals obtain these accounts for two key reasons:

  • Saving for a need, such as retirement, education or health care.
  • A method for reducing, deferring or eliminating taxes on the gains.


2. An Individual Retirement Account As a Tax-Savings Vehicle

Traditional IRAs offer two big advantages or incentives to encourage people to save for their retirement. First, regular contributions to a traditional IRA or real estate IRA may be tax deductible on an IRA holder’s tax return (IRC Sec. 219(a) and (b)). Second, earnings on a Traditional IRA are not taxed until the IRA holder or beneficiary takes the money out. It is these regular deposits, accrued earnings and the passage of time that combine to produce large account balances. And, with a Traditional Individual Retirement Account, you can choose your investments.






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Roth IRA vs. Traditional IRA – Which will you self-direct?

Effective January 1, 1998, IRC Sec. 408A, enacted under the Taxpayer Relief Act of 1997, permits the establishment of a Roth IRA. A Roth IRA is a type of retirement account whereby contributions are not deductible, but distributions (including earnings) can be tax free if certain circumstances exist, particularly if the account is a Roth Self Directed IRA.

Understanding general tax law will assist in making the decision between Traditional IRAs and Roth IRAs. Your accountant may be able to assist you in determining the account that will best suit you.

Small Business Tax Benefits

Many employers choose a qualified plan to obtain the tax benefits. The tax benefits of qualified plans are worth noting.

Generally, contributions to a qualified plan by an employer are tax deductible. Earnings on funds held in a qualified plan accumulate on a tax-deferred basis. As with plan contributions, earnings on contributions are not taxed until a distribution from the plan actually occurs.

Effective January 1, 2006, the establishment of an Individual Roth 401k was allowed. An Individual Roth 401k is a type of 401k that allows a small business owner the benefit of tax-deductible contributions and non-tax deductible contributions. The non-deductible (Roth contributions) and the earnings can be distributed tax free if certain circumstances exist.

Learning about and using these accounts will help you meet your retirement planning goals.



What is a Self Directed IRA?

A Self Directed Ira is literally just that. It is an IRA account that you direct your investments. Your IRA can hold more than stocks mutual funds and bonds. You can have a myriad of investments your advisor won’t tell you about.

Why Would I want to Self Direct my IRA?

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Knowledge is power. You don’t have to settle for assembly-line one-size-fits-all type investing strategy. There are many alternative investment opportunities available, but how are you to know which is which? What other opportunities are out there that you can directly control? This is where education about such matters becomes paramount.


Why have I not heard about this?

Ever since IRAs were created in 1974, people have mistakenly thought them to be brokerage accounts.

The option to control your own retirement money was not hidden; it was just not promoted or marketed.


IRS Section 408 Individual Retirement Accounts

IRS Definition:

An IRA is a Trust created or organized in the United States for the exclusive benefit of an individual or his beneficiaries.

What does this mean?

An IRA is a Trust
When you form an IRA you are creating a Trust. This creates a legal separation between you and your retirement account.


This legal separation is what provides the tax advantages of an IRA.

How Does This Benefit YOU?

An IRA can invest in the same things that a Trust can invest in. It is not restricted to stocks, bonds, and mutual funds. Consider the possibilities…


Some Investment Options

  • Residential & Commercial Real Estate
  • Gold, silver, and other metals (bullion)
  • Private Companies
  • Lending
  • Trust Deeds & Promissory Notes
  • Futures
  • Also, stocks, bonds & mutual funds

These are just some of your options.


Excluded Investments

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The IRS does not outline what you can invest in, only what you cannot invest in. The only excluded investments are the following:

1. Life Insurance Policies
2. Collectibles (excluding government minted coins)


Just My IRA?

You can self-direct any retirement account, not just an IRA. This includes:

  • Traditional IRA
  • Defined IRA
  • Roth IRA
  • 401(k)
  • Individual K Plan
  • HSA Accounts

What is the NEXT STEP?

You first open up a Self Directed Roth IRA at a reputable Self Directed Custodian. We like Vantage IRA, LLC ( )

We have worked with this company for years. It was formally Entrust Arizona ,LLC. Once you have your account set up, you can transfer the dollar amount of your choosing to your IRA at Vantage, or what ever custodian you choose. Remember you can move your 401K into a Traditional Self Directed IRA. You generally move like to like. Roth to Self-Directed Roth, and Traditional to Self Directed Traditional. The Self Directed portion of the account only means that you are directing your investments and you are responsible for the investment choices you make. You are also responsible to abide by the rules associated with self-directing your IRA.

Remember to always consult your attorney or CPA prior to making any investment decisions.

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