All Forum Posts by: Greg Boots

Alfred,

A "Checkbook IRA LLC" is a combination of an IRA and a single member manager managed LLC. In this strategy the single member is the IRA and your are the manager of the LLC. As the manager you have complete investment authority which allows you to bypass the normal process of having to deal with the IRA custodian in traditional self-directed IRAs.
I currently do not have any clients that have used this structure. In theory they should work. However, it is very advisable to do your due diligence on the company you chose. There are some prohibited transactions they need to make you aware of when you are interacting with a business owned by your retirement account.
Traditionally, the IRS takes a hard look at IRA transactions, especially Roth IRA transactions.

Welcome to the group Tracy. What kind of deals are you doing in the Seattle market?

Absolutely, your local professional is going to the know the ins and the outs of the your state.

Robert,

I agree with a majority of the post. It is better to flip in an entity taxed as a corporation.

The article doesn't address the fact that the LLC can elect to be taxed as an "S" corporation and you have the same tax result through the LLC as you would in a tradition "S" corporation.

One issue I disagree with in the article is the percentage of earned income that needs to be claimed. The IRS is cracking down hard on entities taxed on "S" corporations where the salary is not reasonable. I doubt that the IRS would classify only 20-30% of income as salary as reasonable. A more realistic figure is 70-80% as salary and 20-30% as a passive distribution/dividend.

This topic covered whether you should use a Limited Partnership or LLC for your long term holds.

http://www.biggerpockets.com/blogs/261/blog_posts/709-llc-or-lp-which-entity-is-best-to-protect-my-rentals-

IRA protections are governed under state law. Generally, the assets inside of the IRA, both Traditional and Roth, are protected while they are held in the IRA. However, once the funds are distributed they can be attached.

Jay,

I would check with the Better Business Bureau and also the State's Attorney General's office to see if any complaints have been submitted.

In my experience, the companies that use attorneys and even CPAs are going to have better success than the home owner.

Jason,

Under the new 121 rules you can still convert your primary residence into an investment property, then sell it two years later and still be eligible for your full capital gain exclusion. Where you run into issues under the new rules is when the property is first used as an investment property and then converted into a primary residence.

Mike,

I would not go down that road. You are opening yourself up for potential fraud and misrepresentation issues.

Generally, it is only businesses that have to file with the Secretary of State that are allowed to use the designations of Inc., Ltd., Corp., LP, LLC.

Joshua,

You can check with your State's Bar Association. In most states it is not necessary to have an attorney for title transfer. You might want to check with a local title company which is generally much cheaper than having an attorney handle the title transfer.