Preparing for a Self-Directed Checkbook IRA: What You Need to Know

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Thinking about a Self-Directed Checkbook IRA to help you build a substantial retirement portfolio? That’s great. But it does not mean that it’s a decision you will want to make overnight. Preparing for a Checkbook IRA should require taking stock of your retirement goals, understanding the process of creating a Single Member LLC, as well as having a clear idea of the types of investments you can make once the Checkbook IRA is ready to go. Here’s what you will need to know.

What to Do Before the Self-Directed Checkbook IRA

Getting ready for a Self-Directed Checkbook IRA can be a simple as reaching out to a Self-Directed IRA administration firm and letting them know your intentions. But before you start that, you’ll want to be clear about what it is that you plan to accomplish. Here are some ideas to help you get ready for the idea of a Checkbook IRA:

  • Understand the Single Member LLC. An LLC can be a complicated thing. It requires a lot of setup—which is a fancy way of saying that there’s going to be a lot of paperwork involved. That should not mean that you avoid a Single Member LLC entirely. But make sure that you understand the structure of a Single Member LLC. After all, this LLC is what you are going to have checkbook control over, allowing you to make the retirement investments you are planning on. If you do not know how to administrate it, it’s only going to cause you headaches. But if you do know what to expect, it can be a financial blessing.
  • Know what will be expected of you. You can call up a Self-Directed IRA administration firm to get an idea of what might be expected as you create a Checkbook IRA. But that does not mean that you should wait until then. Learn more about the Single Member LLC by looking up the LLC rules in your own state. After all, there’s no single answer to what you will need to do to create an LLC within your state; each state is different.
  • Know your limits. A Self-Directed IRA is a powerful way to invest in nontraditional retirement assets, but that does not mean that it’s without limits. The IRS will limit your investments and transactions, especially when it comes to “disqualified persons” with whom you transact in a Self-Directed IRA. Once you know these limits, you will have a far easier time discerning what sorts of investments you can make with a Self-Directed Checkbook IRA.
  • Create a plan. What do you plan on investing in when you have a Self-Directed Checkbook IRA? Sure, the chief advantage of this arrangement is that you will have flexibility to try different investments. But if you want to get the most out of a Checkbook IRA, you should be clear about what you will want to accomplish. What will your portfolio look like? What kind of investing experience do you have? And how might you leverage that experience to take advantage of a Self-Directed Checkbook IRA?

You should also be aware that the Checkbook IRA tends to load the work up front. In establishing a Self-Directed IRA that holds a Single Member LLC, the paperwork tends to happen all at the beginning. Do not be put off by this if you know that a Self-Directed Checkbook IRA is right for you. Instead, embrace the process, be thorough and diligent, and understand that once you have properly set up your Checkbook IRA, you can look forward to a lifetime of flexible investing. When you understand what goes into a Checkbook IRA, there will be fewer surprises waiting for you down the line.

Interested in learning more?  Contact TurnKey IRA at 844-8876-IRA (472) for a free consultation.  Download our free guide or visit us online at

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