How and with whom I can open a Self Direct IRA?

7 Replies

@Antonio Carrero

Mainstream stock brokerages and banks do not offer self-directed IRA plans. There are a number of specialty providers that serve this niche, which is basically an IRA with a broader capacity for investing beyond the stock market.

Several such providers are active here on BP and contribute to the community.

There are two types of providers, and the best for you will depend on your investment goals.

If you are thinking of something fairly singular and static, a self-directed IRA custodian will be a good fit. Such institutions typically have the word "trust" in their name. IRA Services Trust Co and Kingdom Trust Co are examples. Think of these firms as a brokerage with different paperwork. The IRA is handled and reported in the same fashion, but instead of just focusing on the public exchanges, they can document an IRA investment into shares of privately held stock, crowdfunds, private mortgage notes and the like. With the custodian approach, they hold the funds, sign every document, cut every check, and receive every deposit.

If your investment interests are more dynamic, and will involve multiple assets or assets that require a lot of transactions such as rental property, then a plan offering checkbook control such as an IRA-owned LLC will be more more effective and efficient. In this case, an IRA with a self-directed custodian will make a single investment into a specially formed LLC. You can be the manager of the LLC and have signing authority, which allows you to handle all plan investment transactions directly via the LLC bank account of your choosing. Specialty advisory firms create these plans, and simply use one or more custodians as the back-end reporting layer.

Similar to the IRA is the Solo 401(k). This is a checkbook control plan based on an owner-only version of a 401(k) plan. If you are self-employed and have no full time employees, this can be a great option.

IRA with checkbook control LLC. There are a ton of them. I use which is IRA Services Trust.

Good luck!

@Neil Schoepp thanks for the mention!

@Antonio Carrero welcome to BiggerPockets and congratulations on the first forum post!

There are several of us who can help you, do your due diligence, search for previous discussions, review references, then speak with two or three service providers. From there you can narrow down to the one you wish to work with.

@Antonio Carrero

Google self directed Ira. Bigger pockets advertisements, and forums can be helpful. What do want? Inexpensive, fast, Good,  helpful, available education, close to you or is online fine, big, boutique, service etc.   figure that out and then interview a few. It’s fairly easy to set one up approx $50. Then figure out how to use it.