Announcement

Collapse
No announcement yet.

ASC Buy In, can I use retirement money

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

  • ASC Buy In, can I use retirement money

    I am considering buying into a local ASC.  I've heard conflicting responses about the legality and tax implications of self directing IRA/Roth account funds to buy the shares.  Naturally, the distributions would go tax free back into the retirement account.  Is this a legitimate means of buying ASC shares?

  • #2
    This is a little tricky. If you will be at all personally involved in the management of the ASC or in any transactions with the ASC, you could blow your IRA tax-preferential status. You would need to use a custodian who specializes in self-directed IRAs.
    Working to protect good doctors from bad advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

    Comment


    • #3
      TD ameritrade will do this for you for a fee, but I see bigger issues.  What happens if there is a capital call?  Phantom income? What do the partnership documents say?

       

       

      Comment


      • #4
        Thank you for your replies.

        I have not been offered shares or reviewed partnership documents as of yet but am considering where to pull my money from if and when this arises.  I know at least 2 investors in the ASC who have already purchased equity using their retirement accnt (but that doesn't necessarily make it legit).  I like the idea of self directing a retirement account so distributions and future sale of stock grow tax free.

        IF there is a capital call, could I not self direct additional funds from the same retirement accnt?

        Comment


        • #5
          This is legit if handled properly. My advice would be that this is not a DIY project. After your IRA owns property, you cannot have any personal management role in the investment or you will be engaging in "self-dealing". Here is a good article from the Journal of Accountancy that explains in more detail.

          You should work with a CPA and/or CFP who can ask all the right questions and advise you of the pro's and con's. Maybe one of the other investors who has already been through this could refer you to somebody local.
          Working to protect good doctors from bad advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

          Comment

          Working...
          X