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Frequently Asked Questions

What is the advantage of pooling assets in an IRA LLC?

Pooling assets in an IRA LLC offers several advantages. One of the primary benefits is the ability to purchase non-traditional assets. Traditional IRA custodians often limit certain investments, making it challenging to contribute to both traditional and non-traditional investments. However, an IRA LLC allows the pooling of funds to purchase assets that an individual may not have been able to afford alone. Another significant advantage is the checkbook control feature. This gives the IRA LLC owner complete control over the funds, providing greater investment flexibility. The owner can manage their retirement assets with ease, creating a business checking account to hold the LLC assets – the retirement assets. Limited liability protection is another key benefit. Owners of an IRA LLC are not personally liable for the business's debts, offering a layer of protection against financial risks. However, it's important to note that there are exceptions to this rule. The ability to create a formal business and managerial structure is also a significant advantage. When multiple people own an expensive asset, having a formal business structure like an IRA LLC can help avoid potential legal issues among investors. This structure includes drafting the Articles of Organization and an Operating Agreement, which are legally binding in the event of a lawsuit amongst owners.
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