Fund Home Depot account with Self Directed IRA funds?

[Erik Kubec]

Hey folks,

I have a SDIRA through Equity Trust Company. Just purchased a condo that need renovation.

I want to issue a single check from the SDIRA to Home Depot and then have my contractor or myself make purchases against that.

They told me they couldn't do this--that my only options were to apply for a credit

Any ideas on how to achieve the goal (writing one large check for $3000 and having the contractor make as yet unknown multiple purchases?)

[Jon Holdman]

This is the big disadvantage of this type of account, IMHO.

A checkbook IRA LLC gives you the control you want, though with more risk. I had a loan to a rehabber go bad a couple of years ago, took back the house, fixed it and sold it. I can't imagine how difficult this would have been without the Checkbook IRA.

Even if you have your IRA get a credit card from Home Depot, will Equity Trust write them a check for a payment? I'm doubtful. Its just to easy for you to have spent the money on something else. OTOH, if the IRA doesn't pay, the money you spend is a contribution, and that has tax consequences.

Your IRA has zero chance of getting a Home Depot credit card, though. HD will want your social security number, which you CANNOT give. You cannot give any sort of personal guarantee for anything your IRA does.

Have your contractor buy supplies and include them in his billings.

Is this a fix and flip? If so, are you familiar with UBIT?