American IRA Releases a List of Self-Directed IRA Prohibition Transaction Triggers

CHARLOTTE, NC / ACCESSWIRE / March 20, 2021 / In a recent post at American IRA, the Self-Directed IRA administration firm released a list of Self-Directed IRA prohibited transaction triggers. These triggers were ways in which an investor could unknowingly stumble into a prohibited transaction. A prohibited transaction is a major point to avoid for Self-Directed IRA investors. In a prohibited transaction, an investor is breaking the rules of retirement investing by receiving some personal benefit from a retirement asset. Because these assets are designed for use in long-term retirement investing, it goes against the law for what may considered a tax-protected retirement asset.

For that reason, this list may be useful for retirement investors, especially those using a Self-Directed IRA. This isn’t to say that the rules only apply for those with a Self-Directed IRA. However, investors who use a Self-Directed IRA can more frequently run into these rules because of the greater degree of investment freedom available within a Self-Directed IRA. For that reason, an investor with more direct control over their retirement assets has to be wary of what a prohibited transaction might look like.

In the post, American IRA spelled out the different appearances a prohibited transaction might take. In one case, a prohibited transaction example might be when an investor purchases something for investing that is not considered a valid retirement asset, such as a collectible or a piece of art. These would be considered personal holdings, not subject to retirement protections.

Another way in which a prohibited transaction may occur is if the investor holding the account does an otherwise valid retirement transaction, but with a disqualified person, thus making it an invalid retirement transaction. For example, if an investor were to purchase real estate property within a Self-Directed IRA and rent it out to someone they didn’t know beforehand, this could be a valid retirement investment. But if the same investor were to rent out the property to a son or a daughter, it would be a prohibited transaction.

“Understanding the difference is key here,” said Jim Hitt, CEO of American IRA. “We released this post to show investors what the boundaries are. After all, retirement investing comes with great tax benefits, if you play by the rules. That’s why it’s so important for investors to know the layout of these rules.”

For more information, visit the post at or call 866-7500-IRA.

“American IRA, LLC was established in 2004 by Jim Hitt, CEO in Asheville, NC.

The mission of American IRA is to provide the highest level of customer service in the self-directed retirement industry. Jim Hitt and his team have grown the company to over $500 million in assets under administration by educating the public that their Self-Directed IRA account can invest in a variety of assets such as real estate, private lending, limited liability companies, precious metals and much more.

As a Self-Directed IRA administrator, they are a neutral third party. They do not make any recommendations to any person or entity associated with investments of any type (including financial representatives, investment promoters or companies, or employees, agents or representatives associated with these firms). They are not responsible for and are not bound by any statements, representations, warranties, or agreements made by any such person or entity and do not provide any recommendation on the quality profitability or reputability of any investment, individual or company. The term “they” refers to American IRA, located in Asheville and Charlotte, NC.”


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