Toll-Free (866) 447-6598

Kaaren Hall udirect ira services llc

Kaaren Hall udirect ira services llc

CONVERTING PRIVATE STOCK IN YOUR IRA TO PUBLIC STOCK

One of the top investments for Self-Directed IRA investors is private stock.  Private companies look to raise capital by offering an equity position in their company.  The IRA can invest and thereby become a “member”.

The asset sponsor selling the stock will typically provide an Operation Agreement and Subscription Agreement which we sign on behalf of the IRA. The individual can sign as “read and approved” and the individual will complete any questionnaire that asks about their “accredited investor” status.

What do you do when the private company your IRA invested in goes public?  Investing pre-IPO in the next “Facebook” is every investor’s dream.  Self-directed IRAs are meant for alternative assets vs. stock market assets.  So what happens when your private stock is now listed on a stock exchange?

Stocks that were purchased as private stock through the IRA can be held in the IRA after they go public.  However, when the client wishes to sell the stock, they will need to transfer the asset to a broker/dealer via a Transfer Request from the new custodian.

When it comes to choosing the broker/dealer, we do not get involved or offer that service.  This is a self-directed IRA after all, so you choose.

After receiving their Transfer Request form we will re-title the asset and transfer it to the new custodian. Then you are free to sell or hold your now-public stock.

Have more questions?  Contact us at (866) 447-6598.

Leave a Reply

Attention:

uDirect IRA Services staff is working both from home and from our offices in response to COVID-19. Rest assured, we are fully operational and ready to help with your retirement needs.