Question 1

What is Checkbook Control?

Accepted Answer

Checkbook control means you have direct access to your IRA funds through a local business checking account opened in the name of your IRA LLC. This eliminates the need to seek custodian approval for every transaction, allowing you to invest instantly by writing a check or sending a wire.

Question 2

What are Prohibited Transactions?

Accepted Answer

The IRS prohibits transactions between your IRA and 'disqualified persons' (which includes you, your spouse, your lineal ascendants and descendants, and any entities they control). You cannot personally benefit from the IRA's investments prior to retirement, nor can you provide services to the IRA's assets (like fixing a rental property yourself).

Question 3

Do I still need a Custodian?

Accepted Answer

Yes. The IRS requires all IRAs to be held by an approved custodian. However, in the IRA LLC structure, the custodian's only role is to hold your membership units in the LLC. They do not approve or process the individual investments made by the LLC.

Question 4

Can I be the Manager of the LLC?

Accepted Answer

Yes. The IRA owner is typically appointed as the non-compensated Manager of the LLC. This gives you the authority to sign contracts, open bank accounts, and direct the investments on behalf of the LLC.

Frequently Asked Questions

What is Checkbook Control?

What are Prohibited Transactions?

Do I still need a Custodian?

Can I be the Manager of the LLC?