Legal Consultations

Due to the complexity of some self-directed retirement plan transactions and the draconian penalties imposed for violating the tax law governing such transactions, many clients prefer to consult with an expert in tax and IRA law prior to undertaking a transaction, or as an on-going consultant during the investment or business activities.

As attorneys with over 25 years’ experience in tax and IRA law matters, we advise many clients on their self-directed transactions. The advice can range from whether a father and son who own an existing LLC may allow their IRAs to invest in the existing LLC, or whether a hedge fund may invest for its own account if the fund is owned by a 401k.

For clients of IRAVillage.com, our affiliated online site for IRA LLCs, our consultation services are free of charge. For all others, our consultations are provided on a fixed fee basis to limit the fee and provide certainty as to amount.

Special Advisor

Some IRA custodians, PENSCO is one prominent example, require IRA owners who establish LLCs to obtain “checkbook control”, to retain a “Special Advisor” to reduce the risk of using a self-directed IRA LLC to make investments. These risks include the following:

  1. Risk that the LLC is not established properly or the LLC documents are not drafted properly.
  2. Risk that you may make an improper investment.
  3. Risk that you may unwittingly incur taxes as a result of having “unrelated business taxable income” or “unelated debt financed income.” Since you are using a tax-exempt entity you need to be aware of transactions that may give rise to taxation.
  4. Prevent you from engaging in a “Prohibited Transaction”. A prohibited transaction is to be avoided at all costs as it will negate the tax-exempt status of your IRA and subject the full value of the assets in the IRA to taxation.

A special advisor can help ensure that your IRA and LLC make legally sound investments and avoid transactions that adversely impact your self-directed IRA.

For clients of IRAVillage.com, our affiliated online site for IRA LLCs, our service as a Special Advisor (or its equivalent if by a different name) is free of charge for the first 12 months. For all others, the service is provided at a fee of $200 per year.