IRA Self Directed IRA
Investing in Trust Deeds with an IRA

Self Directed IRA Restrictions

You can invest in Trust Deeds with your IRA with some restrictions.

  • Arms length transaction – you cannot buy/sell assets to your IRA from/to yourself or certain family members
  • You and your family members cannot use the asset personally
  • You cannot personally sign the loan documents; you have to use a special loan called a “non-recourse loan”.
  • You cannot borrow money from your IRA
1
Can I use an IRA for trust deed investing?

"YES!" Working with a self-directed IRA custodial company is the first step. Firms such as these are central to the administration of IRA's that are alternative asset classes of investments such as trust deeds, commodities, and real estate. Administrative costs are somewhere between 0.3% and 0.5% of the asset(s) managed per year.


2
Why Would I Want to Use IRA Funds Instead of Other Funds to Invest in Trust Deeds?

IRA's or other qualified retirement accounts receiving money are able to re-invest that money tax-free. Taxes are due as the funds are withdrawn from an account. Trust deed investment income is treated as ordinary income, therefore taxes are appropriated at a higher rate compared to other sources of income. Investing from IRA accounts will neutralize the disadvantages for trust deed investing as opposed to other sources of investing which will be taxed at a lower amount.


3
Using Your IRA funds to Invest in Trust Deeds and Promissory Notes

Utilizing your IRA funds to invest in Trust Deeds is becoming much more favorable due to the tax treatment, low maintenance and above average yields (10% plus). You can make a safe investment as a first position lien holder or take second filling the gap with a much lower investment amount, but with higher risk.

Advantages with Using Your IRA to Invest in Trust Deeds
  1. Positive cash flow notes
  2. 1st Trust Deed. Notes rarely have expenses unless there is a default.
  3. Predict future yields
  4. No liability exposure
Disadvantages with Using Your IRA to Invest in Trust Deeds
  1. IRA owning Trust Deeds are not easily leveraged
  2. Funds are not very liquid

We always recommend you review any investment when using your IRA with your Self Directed IRA custodian. Violating IRS laws regarding your Self Directed IRA funds can cause serious taxable penalties and cause your IRA to be effectively distributed and penalized.

Need to Contact an IRA Custodian Company?

There is a small list of custodian companies that work with Self Directed IRA funds.

  • Self Directed Custodian Companies
  • IRA Resources, Inc
  • Trust Administration Services Corp
  • Udirect IRA Services
  • Polycomp Admin Services
  • Pensco
  • IRA Services Trust Company
  • Equity Trust
  • Entrust Administration
  • Guidant Financial Group
  • Lincoln Trust
  • Mountain West IRA
  • Sunwest Trust
  • iPlanGroup
  • Sterling
  • Phone
  • (858) 459-1212
  • (800) 455-9472
  • (714) 460-5505
  • (800) 952 8800
  • (800) 969-4472
  • (800) 248-8447
  • (440) 323-5491
  • (800) 392-9653
  • (888) IRA-XCEL
  • (800) 521-6974
  • (208) 377-3311
  • (505) 237-2225
  • (855) 604-7526
  • (800) 955-3434
  • Location
  • La Jolla, CA
  • Carlsbad, CA
  • Tustin, CA
  • Roseville, CA
  • San Francisco, CA
  • (800) 248-8447
  • (440) 323-5491
  • (800) 392-9653
  • (888) IRA-XCEL
  • (800) 521-6974
  • (208) 377-3311
  • (505) 237-2225
  • (855) 604-7526
  • (800) 955-3434

Invest Your IRA in Trust Deeds and Receive Great Returns

Time to start Investing You IRA in Trust Deeds! Get started here.

Minimum Investment for Trust Deeds

We are here to answer any questions about trust deeds such as the minimum amount you have to invest, etc.

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