It’s Time for a Checkbook Control Q&A!


Gaining checkbook control through your IRA is a powerful tool for managing your assets as a self-directed IRA owner. But what is it? Checkbook control is a term used when a person who has a self-directed IRA has ownership, and signing authority over their retirement funds.

Q. How do I set it all up?

A. To get going on your own checkbook for your IRA, you will first need to establish an LLC that’s owned by your IRA. After that, a business checking account will be set up in its name, and that requires an EIN, or tax ID number.
The funds in your IRA and business checking account will then be linked together, and once this is done, you’ll be issued a checkbook that is attached to that checking account. You will then need to elect yourself the Managing Member of your LLC, and will then have control over the checkbook. Tada! Checkbook control!

Q. What about the rules?

A. The best thing about checkbook control is just that, control. It allows you to invest in just about any type of opportunity that you come across. Investments like:

  • Real estate – repairs on properties, property taxes, HOA fees, contractor fees, etc.
  • Precious metals
  • Hard money lending
  • Stock options
  • Foreign currency
  • Private business

You’ve gained more freedom to quickly invest in what you want to invest in. Of course, more traditional investment options like mutual funds and bonds are still great options, but who doesn’t want more variety?

Q. With great control, comes greater responsibility?

A. This isn’t just Spider-Man’s (sort of) motto, it’s also just solid advice. There are some limitations to all this checkbook control you’ve been loving, just as there are with a typical self-directed IRA. There are prohibited transactions, especially when you’re using a single-member LLC. For instance, disqualified persons, with yourself included, cannot vacation on the property that your IRA owns. You also cannot directly benefit from your investments, all of the money that’s made from say, a rental property, have to go back into your IRA.
If it’s found that rules have been broken, penalties could be issued, and in some cases, lead to disqualification of your retirement account.

Q. Are there specifics to Accuplan?

A. The use of a qualified IRA custodian is required to gain checkbook control, and here at Accuplan, we use the services of American Estate & Trust. The benefits to using American Estate & Trust and Accuplan are:

  • Experience – dedicated to dealing with self directed IRA accounts
  • Flexibility – focused on providing self directed IRA account services tailored to the needs of the self directed IRA account holder
  • Seamless integration – Accuplan Benefits Services and American Estate & Trust are owned by the same principals with common support staff, so you will get a completely integrated, one-stop solution for your self directed IRA needs

There are definitely more pros than cons when it comes to checkbook control, but it’s all about using it wisely and responsibly. Checkbook control might not be for everyone, and that’s to be expected, but for those of us that want true control over their self-directed IRA, there’s no better option.

Author: Tanya