Self-Directed IRA - investment in a franchise

[Robert Taylor]

I was wondering if anyone has bought a franchise using a self directed IRA and what some of the limitations are. Could you do work there? I have a self directed I use for other investments, and I have read a little about investing in real estate, and the "sweat equity" issue. I assume it applies in a similar way where it might conflict, but what if it's paid?

My thought is to purchase a franchise with a partner, I bring the money, they run the day-to-day. Would I be in a danger if I took a pay check from the franchise to do the books or as an hourly employee? I have a feeling that's not a good idea. Is there a clear directive on the issue? Would it be different if I made a loan to the partner in return for a percentage of the business? I guess what I want to do is separate the money earned as an investor, from some money earned hourly as a service provider or employee. 

Just looking for ideas. Thanks in advance for thoughts and advice.