While the term ‘checkbook IRA‘ is not quite official it refers to an IRA account that gives you the opportunity to control your investments through your checking account. You simply establish a legal entity such as an LLC or trust, which will be managed solely by an administrator or the account holder. Basically, the IRA will open a bank account allowing the account holder to receive the checkbook for the account. Then the account holder will be able to make investments using IRA funds simply by using checks.
The Benefits of a Checkbook IRA
When you set up an IRA using a checking account you will a higher level of control. Even self-directed IRAs that are not linked to a checking account, must always have an account manager so that you can make investments. By using a checkbook, you get the opportunity to enjoy immediate action as the account holder. Essentially this means that you can eliminate a two or three-day review. That is most commonly standard for investments that must go through a custodian. You may also save on custodial fees by using this type of IRA. You may still need a custodian to oversee your account, however they may only charge a minimal annual fee.
When Should This Type of IRA Be Used?
Typically, this type of IRA is perfect for individuals that are very familiar with making investments as well as tax accounting. He gives you the ability to start setting up a retirement account with ultimate control. You can get the most out of your retirement plans and ensure that they are well-versed and you’re making tax-deferred investments when you follow the guidance provided by a professional IRA company. They can ensure that you are well within IRS regulations so that you can start saving more for your retirement today.
