Saturday, May 06, 2006


Let me start by giving you some background information. First of all, most custodians, even true self directed custodians, require massive amounts of paperwork and numerous hoops to jump through in order for you to invest your IRA money in an "alternative" investment. This costs you time and money (custodian fees). To more effectively use your IRA, your IRA will instead place all of its assets into a limited liability company (LLC). Therefore, there is only one asset to be declared by the custodian to the IRS and this translates to fewer fees to you. Notice I did not say that your custodian manages your IRA. Then who manages the IRA? well, you of course.

Why an LLC? The LLC gives great asset protection and tremendous tax advantages. The LLC enjoys the asset protection of a corporation while it can be taxed as a partnership. Partnership taxation is great because the LLC itself will not pay taxes. Instead, the owner of the LLC pays taxes as if they earned the income. Who is the owner of the LLC? Your IRA is the owner of the LLC(a tax- exempt entity). Therefore, you can maximized your investment and pay no taxes, what a deal.

What are the "alternative investments" mentioned above? They are too multiple to mention here but I will try:

real estate, other LLC's, franchises, unsecured loans, corporations, mortgage notes, commodities and futures, joint ventures, tax liens and tax deeds, currency exchange, times shares, limited partnerships, timberland investment, real estatle options, commercial paper, hunt lease investments, stocks, bonds, mutual funds, annuities, ect.


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