Invest Your Retirement Funds in Privately Held Entities

A private equity IRA is a type of investment in privately held entities unavailable to the public. Private equity investments are also known as private stock, private placements or private placement memorandum (PPM).

Many types of private equity offerings are available, including real estate ventures, investment partnerships and operating businesses. These offerings are often limited partnerships, limited liability companies (LLC) and similar entities looking to accredited investors to accrue the capital required to grow businesses.

What Can Your Self-Directed IRA Invest In?

Your self-directed private equity IRA — or self-directed private placement IRA — enables you to invest in privately held entities using your retirement funds. Some types of private placements you can invest in include:

Real Estate Investment Trusts (REITs)

A REIT is a real estate investment trust. This type of private equity is where the retirement portfolio owns either private or non-traded real estate holdings. Neither type of REIT is traded publicly, but non-traded REITs have to register with the SEC, while private REITS are not required to register.

Limited Liability Companies

LLCs are not generally subject to any state or federal taxes. So instead, the LLC’s profits would flow through to the various owners of the LLC, and are then taxed as individuals on their own share of the LLC’s taxable income.

Limited Partnerships

A limited partnership is when individuals are invested in a business but are not directly involved in the day-to-day management. In a limited partnership, partners share equal responsibility for the business’s profits and losses, as well as the debts and liabilities.

Private Stock

This is a share in a private company that is not being traded on a public exchange. Private stock is primarily held by the company’s founder, venture capitalists, or private equity firms.

Privately Held Hedge Funds

Hedge funds offer investors the opportunity to pool funds with other investors. This allows a group of investors the chance to pursue investments with greater buying power.

More types of private equity include:

How to Start Investing in Private Equity via Self-Directed IRA

Follow these steps to invest in a private placement with a self-directed IRA:

1. Create a self-directed IRA: Establish and fund your own self-directed IRA with a reliable custodian.
2. Fund the account: Transfer funds from your existing IRA or roll funds over from your 401(k). Direct your investments into Accuplan easily online on our user portal.
3. Make the investment: Your self-directed IRA custodian will invest in the private equity investment of your choosing on your behalf.

Perform your due diligence on potential investment options before lending money or investing in a business. Speak with a qualified investment or legal advisor for more guidance on vetting an investment.

Rules for Investing in Private Equity

You need to follow these rules when investing in private placements:

• Your IRA cannot buy into a private stock that you own.
• You cannot invest in an S-Corp.
• Any earnings made on private placement investing must stream back into the IRA directly.

Accuplan is your private placement IRA custodian. The Internal Revenue Service (IRS) has many investment rules you need to follow — we will help you understand self-directed IRA investing rules so you can remain compliant.

How Do I Know if Private Equity Investing Is Right for Me?

When it comes to private equity in a self-directed IRA, high risk can mean a high reward. Most often, those investing in private equity inside an IRA must try a hands-off approach. You need to be a silent partner, or you put your IRA at risk of breaking IRS rules. If this unique strategy sounds intriguing, then private equity investing inside an IRA may be for you. The experts at Accuplan can help you decide if this investment type is right for you.

Why Choose Accuplan for Your Private Equity Investments?

Accuplan is one of the leading providers of self-directed IRA investments, including private placements. Since 1985, we have helped our clients expand their portfolios to include investment types besides stocks and bonds.

What makes Accuplan stand out is our:

• Experienced team: Our experts have years of experience with self-directed IRAs and retirement investments. We will help you understand how these investment vehicles work and the unique IRS compliance rules and laws.
• Intuitive platform: We designed our platform with our clients in mind. We will help you do more with your retirement portfolios and offer more opportunities to your clients.
• Secure services: Accuplan manages over $2 billion in assets and over 10,000 active accounts. We lead with professionalism and discretion for our valued clients.

Open a Private Equity IRA With Accuplan Today

Accuplan works with companies and individuals to help them expand their retirement investment options. You can rely on our expertise to invest in opportunities outside the stock market while complying with IRS regulations.

Open an account with Accuplan today to expand your portfolio and learn more about our other self-directed IRA accounts.