Self-Directed IRAs and NPN Investing

[Ronald Lambert]

Hey everyone, hoping to get some guidance. I have been doing some JV deals in my SDIRAs involving non-performing notes, where I am in the role of the investor. I now would like to use my SDIRA where I am in the role of handling the workout: working with vendors (servicing, loss mitigation, attorneys, etc) to work the note to resolution, but of course no direct borrower contact. I liken that process to someone owning rental properties where they select and manage the property managers, contractors, etc but never "work" on the house.

Any thoughts?  Anyone doing that today?  My CPA is not overly experienced with SDIRAs and is advising me not to go there. He states that the IRS has specifically notes Real Estate in the SDIRA guidelines, but not anything like notes.

Also, I have recently formed an LLC from which I will be JV partnering with investors to purchase and work out NPNs. I have a fulltime W-2 job, so this would be a side gig. Does the LLC existence and direction put me at more risk for IRS scrutiny within my SDIRA?

Any input would be much appreciated from the BP community.  Thanks!