How a Self-Directed IRA LLC Works

A self-directed IRA LLC is a limited liability company owned by your IRA. You manage the LLC, and the LLC holds the IRA's money in its own bank account. When you find an investment, you sign the check yourself, with no need for the custodian to process each transaction. This is called checkbook control.

The structure

Setup steps

1. Open a self-directed IRA with a custodian that allows LLC investments, and move funds into it by transfer or rollover.
2. We form your LLC in your chosen state with articles of organization, an IRS-compliant operating agreement, and an EIN.
3. Your custodian invests the IRA funds in the LLC in exchange for 100 percent ownership.
4. You open the LLC bank account and the custodian sends the funds there.
5. You invest directly from the LLC account, following the prohibited transaction rules.

What it costs

Our formation fee is a flat $1,495 for a single-member IRA LLC or $1,695 for a spousal IRA LLC owned by two spouses' IRAs, plus your state's filing fee, which is shown at checkout. There is no monthly subscription. Separately, your custodian charges its own account fees, and most states require an annual report or fee to keep the LLC in good standing.

Why use an LLC instead of the custodian alone

• Speed, because you can close on time-sensitive deals yourself.
• Fewer custodian transaction fees, because the custodian is not processing each investment.
• Control, because you choose and manage the investments.
• Liability protection, because the LLC structure separates the investment from the rest of the IRA.

Annual upkeep

• Keep all records and statements for the LLC account.
• Report the LLC's year-end value to your custodian each year.
• File any state annual report.
• File Form 990-T if the IRA has $1,000 or more of gross unrelated business income.