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Sdira presentation 2012


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Sdira presentation 2012

  1. 1. Introduction toSelf-Directed IRAs Presented By Gary Kowalski Director of Sales
  2. 2. Preface What is a self-directed IRA? An industry term for an IRA that invests in non-traditional assets such as Real Estate, Private Stock, Precious Metals, etc.
  3. 3. About The Entrust Group Administrators for self-directed retirement plans Leader in our industry • Over 30 years of service • 14,000+ clients and nearly $2 billion in investor assets
  4. 4. About The Entrust GroupEntrust is the premier provider of self-directedretirement plans: Knowledgeable staff • All staff eligible have earned CISP designation Educators • National CE Program • National and local in-person events and webinars Local offices
  5. 5. DisclaimerThe Entrust Group ("Entrust") does not provideinvestment advice or endorse any products.All information and materials are for educationalpurposes only. All parties are encouraged to consultwith their attorneys, accountants and financial advisorsbefore entering into any type of investment.
  6. 6. Investment Choices Single family and multi-unit  Trust deeds homes  Leveraged property Apartments  Precious metals Condominiums  Limited liability companies Commercial property  Limited partnerships Developed & undeveloped land  Unsecured/secured loans Mortgages, lease/options  Joint ventures Foreign property  Life settlements
  7. 7. Investment Restrictions Prohibited Assets  Collectibles • any work of art, • any rug or antique, • any metal* or gem, • any stamp or coin*, • any alcoholic beverage  Life Insurance  S Corps (S corporation tax laws prohibit IRAs to invest in them.)* Exceptions: Gold, Silver, Platinum & Palladium bullion of certain purity
  8. 8. Disqualified Persons  Your Spouse  Your Parents  Your Grandparents  Your Children  Your Grandchildren  Spouses of Lineal Descendants  IRA FiduciaryCertain family members cannot do business with your IRA.
  9. 9. Examples of Acceptable Transactions  Partnering with yourself on a new deal  Partnering with your spouse on a new deal  Partnering with your cousin  Leasing the property to your siblingsRemember the Self-Benefit Rule
  10. 10. IRA Purchase of Vacation Property IRA purchases vacation property in Hawaii • Purchase contract must be signed by Entrust and signed “Read and Approved” by IRA holder • Vesting must read “The Entrust Group Inc. FBO J. Smith IRA account 12345” • All rents/expenses flow into/out of the IRA • Cannot stay there on holiday; cannot provide sweat equity
  11. 11. IRA Purchase of Rental Property Rental property in Davis • Daughter cannot rent from your IRA even at fair value • IRA can borrow funds to purchase real estate • Percentage of net income attributable to the loan may be subject to UBIT (Unrelated Business Income Tax)
  12. 12. LLCs With an LLC, the IRA account makes an investment in the LLC by acquiring its member shares. Advantages:  Affords “checkbook” control  Immediate access to funds  Ease of investing  Savings on check fees  Limited liability protection from claims Disadvantages:  Cost to create  You maintain records  Single investment at inception  May be subject to State taxes and filings – check with your financial or tax advisor
  13. 13. Business TrustsWith a business trust the IRA account makes an investment in thebusiness trust by acquiring its "beneficial interests." Advantages:  Affords “checkbook” control  Immediate access to funds  Ease of investing  Savings on check fees  Greater privacy of information Disadvantages:  Cost to create; more expensive than LLC  May be subject to State taxes and filings – check with your financial advisor
  14. 14. Plan Types Traditional IRA Other Special Plans: Roth IRA Coverdell (ESA) Individual (k) Health Savings Accounts (HSA) SEP & SIMPLE 401(k) - Record keeping for defined benefit plans that allow for alternative investing. - Required plan documents (“Do your own”)Funds from a Qualified Plan, including 401(k), 403(b), 457 plans can berolled into an IRA.
  15. 15. Getting Started is EasyThree Easy Steps 1 2 3Open an Fund Your PurchaseEntrust Account Your AssetAccount
  16. 16. The Next Steps Take Action On Our Website1 Sign up for a class or webinar Calendar of events Schedule a meeting with an2 Entrust representative E-newsletter Read about self-directed3 retirement accounts Due Diligence Info4 Call our office Free Reports FAQs5 Join us on Facebook & Twitter
  17. 17. Gary Kowalski Director of Sales 555 12th Street, Suite 1250 Oakland, CA 94607