What to Expect When You’re Self-Directing ~ Notes
We want the investment process to go as smoothly as possible. Please review this list before submitting your paperwork to us.
With a self-directed IRA certain parties are Qualified and some are Disqualified to your transaction:
Who’s Qualified
- Your brothers and sisters
- your spouse’s brothers and sisters
- your spouse’s parents
- your spouse’s grandparents
- your spouse’s stepchildren
- your grandparent’s spouse, if not your natural grandparent
- your aunts, uncles, and cousins
Who’s Disqualified
- you
- your spouse
- your parents and/or your adoptive parents
- your natural grandparents
- your natural children and/or your adopted children
- your stepchildren
- The spouse of your natural children
- your grandchildren
- Any fiduciary
- Any people providing services to your IRA
We want to help you prevent a “Prohibited Transaction”:
- Neither you nor any disqualified people may benefit from IRA
- Present Benefit
- Indirect Benefit
- Personal Benefit
- Cannot buy, sell or exchange property between plan and Self or Disqualified people
- A Disqualified person cannot provide goods, services or facilities
When you submit your documents to us we will review them for the following:
- Can we see any sign of a prohibited transaction?
- Is the name of the investor correct (the investor is the retirement account)
- Are there enough funds in the account to cover the investment?
- Is the Direction of Investment form fully completed?
- Do the amounts on the DOI and the investment documents match?
- Did the borrower sign the notes?
When investing in notes, please insure that the following items are supplied for Loan:
- Loan Docs – Lender = “Custodian” FBO the IRA – Borrower name spelled out – Borrower is US Based – Loan Payments in US Currency
- Check for disqualified parties – borrower cannot meet IRC 4975 definition of disqualified party —-> Check to insure borrower is not related or disqualified party
- Check/wire instructions need to be presented —> Check for funds being sent to third parties or disqualified parties —> No offshore lending or payments or currency conversion
Your documentation will go through two reviews. First there is a Compliance Review. After the Compliance Review we may come back to you with items that need to be corrected or we may request additional documentation. The second review is the Funding Review. This is the last set of eyes to look at the transaction before account funds are disbursed. Additional conditions may be requested at this time.
What You (The Investor) Does
◆ Does all the homework on the investment risk
◆ Chooses the investment
◆ Conducts all due diligence
◆ Negotiates the price of the asset
◆ Makes sure investments are not prohibited by IRS
◆ Makes all investments in the name of the IRA account
◆ Makes sure transactions don’t include disqualified persons
◆ Monitors their account
◆Completes documents or has them completed
Services uDirect IRA Services Provides:
◆ Administers the sales and purchases of assets, and processes invoices
◆ Administers account contributions and distributions
◆ Signs documents on behalf of the IRA
◆ Provides accurate and timely IRS reporting
◆ Provides IRA account record-keeping
◆ Provides an online statement available 24/7
What uDirect IRA Services Does Not Do:
◆ Endorse any particular product or company
◆ Offer products or recommend investments
◆ Provide tax or investment advice
◆ Provide legal or financial advice
◆ Supply investment templates
◆ Complete account-holder’s forms
