If you’ve ever wanted to write checks straight from your retirement account (and who hasn’t?), a Checkbook Control IRA might be the ideal setup for you. It gives you direct access to your Self-Directed IRA funds through a specially structured LLC, meaning no waiting on a custodian to sign off on every move you make. It’s popular with real estate investors, private lenders, and anyone tired of playing phone tag just to cut a check. The process sounds a little intimidating at first, but it’s more manageable than you might think, especially if you’ve got a roadmap.
Step 1: Open a Self-Directed IRA
The foundation? Start with a Self-Directed IRA. This is the account that gives you access to a wider range of investments, from real estate to private notes to precious metals. You can open a new account or transfer funds from an existing retirement account, like a traditional IRA or old 401(k). This part is pretty straightforward, especially if you’re working with a custodian who specializes in alternative assets. (And yes, TurnKey IRA does handle this, but more on that in a minute.)
Step 2: Set Up an IRA-Owned LLC
Here’s where the “checkbook control” part kicks in. You’ll form a limited liability company (LLC) that’s 100% owned by your IRA. That’s right—you won’t own the LLC personally. The IRA is the member, and the LLC becomes the investment vehicle. This structure is what allows you to bypass the usual back-and-forth with your custodian every time you want to make a move.
It’s important that the LLC is set up correctly—with the right operating agreement, language, and paperwork that reflects its IRA ownership. A custodian or facilitator experienced in Checkbook Control setups can help make sure everything’s above board.
Step 3: Open a Bank Account for the LLC
Once the LLC is created, it’ll need its own checking account. This is the account you’ll actually write checks from, use for wire transfers, or tap into for investment expenses. Again, the account belongs to the LLC, not you. But you’ll typically be named the manager, which means you’ll have signing authority and the ability to act on behalf of the LLC.
That control is what makes this setup so appealing—you can act fast on investments, pay contractors, or send earnest money for a property deal without waiting on third-party approval.
Step 4: Fund the LLC from Your IRA
Next, you’ll direct your IRA custodian to invest in the LLC. This is how the money gets from your IRA into the LLC’s bank account. Once the funds land, you’ve got what people mean when they say “Checkbook Control.” Just don’t forget: it’s still an IRA. You still have to follow all the usual IRS rules around prohibited transactions, disqualified persons, and what types of expenses the account can cover.
Step 5: Start Investing (Carefully)
With the account funded and ready to go, you can start making investments. Real estate purchases, private loans, tax liens, business deals—the flexibility is incredible. Just be sure to keep excellent records and avoid any transactions that involve you or certain family members directly. One wrong move can risk the tax-advantaged status of your entire IRA.
That’s why having a knowledgeable custodian and a good advisor is so helpful. You get the control you want, but with a safety net of compliance guidance to keep your retirement strategy running smoothly.
Curious if a Checkbook Control IRA is right for you? The team at TurnKey IRA can walk you through every step as you open your first Checkbook Control IRA. Call us at 844-8876-IRA (472) and let’s make your IRA work the way you want it to.
Interested in learning more? Schedule a free consultation. Download our free guide or visit us online at www.turnkeyira.com.
