Guest views are now limited to 12 pages. If you get an "Error" message, just sign in! If you need to create an account, click here.

Jump to content
  • CRYPTO REWARDS!

    Full endorsement on this opportunity - but it's limited, so get in while you can!

IRA penalty amount upon total cash in


Kanga
 Share

Recommended Posts

Re SZ's question about a Roth IRA:

I opened a self directed Roth IRA, through an administrator Trust Co currently being acquired, so I am not inclined to recommend it until I see how good the new guys are. Suggest you google "self directed Roth IRA" to find a number of potential trustees near you.

You want a self directed IRA because no professional IRA administrator would take the responsibility of an investment in Dinar. The trust/admin company will provide the forms to create the SELF-DIRECTED ROTH IRA and its own checking account. You then should form an LLC in a no tax State (Florida is very cheap, easy, and you can do it all on line very quickly) which has the Roth IRA as the sole equity member and you as the sole managing member. The trust/admin company should have articles and/or an operating agreement acceptable to it for this purpose. The key here is that the operating agreement needs to specifically state that the company shall not enter into any transaction that would disqualify its sole member's status as a tax exempt IRA or which is prohibited to be undertaken by an IRA. (This applies to self dealing, collectibles, and various other investments and transactions prohibited to all IRAs.). In most states the LLC articles are just one or two pages of boiler plate that merely identifies location and ownership. In many states, including Florida, the operating agreement is not a public document and is not filed with any agency. This is where the important admin provisions are, because you can/should provide for successor managing members, etc.

You can personally advance the nominal funds for the creation of both the Roth IRA and the LLC. When that is done, put your $$ into the IRA by sending a check to the trust/admin account, which they will deposit into your IRA's bank account. Then send them a request (usually on their form) for a cashier's check payable to your LLC. Take that check and open a bank account for the LLC at any bank (one of the Big 4 probably best for lots of reasons). Purchase Dinars from any vendor you want using the funds in the LLC's bank account. You will need a federal tax ID number for the LLC to open its bank account, which you can easily do with the IRS on line. Be sure to indicate that the LLC has just one owner: one owner LLCs are not required to file any tax return, their activities are reportable on the tax return of the LLC's sole owner. The Roth IRA does not file a tax return. The activities of the LLC are therefore not reportable to anyone, although I believe the trust/admin company does have an annual report to file for which it needs the value of the assets held by by the Roth IRA, which of course includes the value of the LLC interest that it owns.

Beware of limits on contributions to Roth IRAs, and remember that your income this year might be less than the minimum floor or might exceed the upper limit. That's a whole other topic that you should discuss with the trust/admin company. You can also google "Roth IRA contribution limits" and get some pretty good discussion. The IRS pamphlet is pretty good, but not very well written and tries to cover to many topics at once.

The gains and income earned within the Roth IRA are of course not taxed, and its distributions to you are entirely tax free under current law. But you cannot draw from the Roth IRA until its fifth year and you need to then be at least 59.5 years old. There are currently no minimum distributions required so you can let the $$ grow tax free as long as you want. The LLC currently has nearly unlimited choices of investments (except, of course, for those prohibited to all IRAs), and I plan to get most of its $$ invested off shore so as to avoid likely future prohibitions on some types of investments by Americans, such as gold. But I plan to invest mostly in US Treasury TIPs, long term bonds that adjust both their interest payment and their principal each six months based on the CPI. The current coupon is around 3.5%, so your total return is 3.5% plus the inflation rate, all tax free. So, one million will provide you with inflation protected tax free income of $3,000 a month for 30 years (callable in 20, I think). See good investment and tax advisers and look at good bond mutual funds.

  • Upvote 1
Link to comment
Share on other sites

Xtaxguy:

I really appreciate your very comprehensive reply. The problem that I am facing is that there are few companies (one in Utah) that is willing to open Roth IRA (say for $6000 for 2011 before April 17th) and they could be directed to purchase IQD from a specified vendor and hold them in a safe deposit box for safekeeping. Money could be withdrawn from this account, if before 5 years, pay tax and if after 5 years no tax on pricipal and appreciation. If IQD is revalued, the Roth IRA company will conver it in US$ that I could invest for further appreciation and will withdraw after 5 years with no tax consequence. Although I have a LLC established in the State of Washington but your suggested approach with LLC slant is new to me and I need to spend some time to better understand this approach. When you are satisfied with your company, pleases let me know its name and telephone number. Once again I am gratefull for your very prompt response.

SZ

Link to comment
Share on other sites

SZ"

The company I used was the Entrust Group at its Orange County Office. I don't know if that office is still open or not. I have only a very confusing letter from the Entrust HQ in Oakland, CA telling me that Provident Trust Group or the First Trust Company of Onaga will be the new custodian of my Roth IRA account. It did not tell me which, nor how to contract either of them. This letter conveys excitement about Entrust's new endeavors without actually saying what they are. When I formed this IRA I dealt with three people; the first two didn't know what they were doing, the third guy was really good but had been an outside consultant that they brought in as a new employee. I'm betting he's not around anymore. There is no real need for you to go see the trustee/admin people if they are any good. You can do it all on the phone and by email. If you hold your big bucks within your self directed Roth IRA you will incur lots of unneeded fees on transactions which will often be delayed by their internal butt-covering bureaucratic rules. The main purpose of creating the LLC that is wholly owned by the IRA and managed solely by you is to allow you to act as fast as you wish with no unnecessary fees, questions, or forms that exist solely to insulate the custodians from liability. The cost to create and maintain a Florida LLC is about $150 a year. If you have trouble doing this stuff, a good local CPA should be able to help you at very moderate cost. April 17th is NOT your only deadline; this won't work unless you get it done before the RV. I went like a bat in late 2010 to get it done before the RV guaranteed by good ole Okie was to happen. Still waiting, but at least I got it done, and I can add to it with no fuss.

  • Upvote 1
Link to comment
Share on other sites

I have a Roth IRA account and have purchased dinar within that account. It was originally opened thru Entrust of Tampa Bay, but they have now split their offices, and my account is now with Advanta IRA Services. Their number is 800-425-0653. They've been great, no problems at all. Since they changed their name, my account rep is Beth Trice, X 1109. She's familiar with the dinar & can help you out. Good luck.

Link to comment
Share on other sites

Guest
This topic is now closed to further replies.
 Share

  • Recently Browsing   0 members

    • No registered users viewing this page.


  • Testing the Rocker Badge!

  • Live Exchange Rate

×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.