QUESTION: I am interested in taking $5,000 from my etrade IRA to invest in the convertible note of my friend's startup, which is an LLC. Will that create any UBI issues prior to or after conversion? What about UDFI?
ANSWER: As long as it is processed as a promissory note and not an equity investment neither UBIT nor UDFI will be triggered as a result of the self-directed IRA promissory note to the LLC.
MORE QUESTIONS: Obviously I want to keep transaction costs to a minimum. Which of these fees are tax dedictible? Wouldn't the custodial fees be dedcutible if separately billed? Is that an option? I woudl prefer to pay all fees (except the 9.99 it will cost to liquidate the position in the IRA) with non-plan funds if possible. The formation costs themselves are decutible, correct?
ANSWER: No none of the fees are tax deductible.
ANSWER: As long as it is processed as a promissory note and not an equity investment neither UBIT nor UDFI will be triggered as a result of the self-directed IRA promissory note to the LLC.
MORE QUESTIONS: Obviously I want to keep transaction costs to a minimum. Which of these fees are tax dedictible? Wouldn't the custodial fees be dedcutible if separately billed? Is that an option? I woudl prefer to pay all fees (except the 9.99 it will cost to liquidate the position in the IRA) with non-plan funds if possible. The formation costs themselves are decutible, correct?
ANSWER: No none of the fees are tax deductible.
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