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Taking Distributions From an IRA LLC Demystified

Learn How To Take Distributions From an IRA LLC Without Sweating Over It

Some Homework Is Required

An IRA LLC can be a convenient investment tool to have in your retirement arsenal. It gives you the ability to cut down on turn around time for your investments and it also gives you the peace of mind to know where your retirement money is being held.

The only problem with IRA LLCs is that there is much information about them readily available to the public and what information is available is often flawed or misleading. I’ve read some crazy things about IRA LLCs on the internet. One company was trying to convince people that they could not have a self-directed IRA without an LLC. Another company was telling people that they could take distributions directly from their IRA LLC checking account and even went so far as to say that people could use LLC funds to pay for personal expenses, such as home mortgage payments. Well, if you’ve read my blog for any length of time, I’m sure you know that those things are ridiculous and just not true about IRA LLCs.

Tips on Taking Distributions From an IRA LLC

Even with all the convenience of IRA LLCs, there are still some transactions that can seem cumbersome. For instance, distributions or transfers to another IRA custodian will take a few additional steps.

Whenever money is leaving the IRA (not leaving the LLC for an investment), it must come back through the custodian first, as a matter of procedure. This means that if you wish to take a distribution, you must send a check from your LLC to Sunwest Trust in the amount that you wish to take. You must also send a distribution form.

Once we receive your check and your distribution form, we will send you a check from Sunwest Trust. This is necessary to make sure that we report your distribution correctly and send you a 1099 for the distribution.

Important Note Related To The Annual Required Minimum Distribution (RMD) Deadline

There’s a special rule for the year you turn age 70½: You have until April 1 of the following year to make the first required withdrawal from your traditional IRAs, 401(k)s, 403(b)s and other retirement plans… By Kimberly Lankford – Don’t Miss The IRA Required Distribution Deadline – www.kiplinger.com.

If you have any questions about a specific situation regarding either full or partial IRA distributions or even RMDs from an account, please be sure to speak with your CPA or a tax specialist.

Terry White

About Terry White

I started my business career after getting my degree in Accounting from the University of New Mexico in 1983. My first job was as a controller for a local title company, and in 1987 I started First Financial Escrow, Inc. Over the years I played a part in several startup companies including First Financial Equities, Inc., First Financial Trust, Inc., First Financial Marketing, Inc. and Asset Ventures, Inc. In 1997 First Financial Escrow, Inc. was able to purchase the escrow accounts from Sunwest Bank and changed its name to Sunwest Escrow. As the market changes, Sunwest has grown and changed along with it. Besides my wife, Sheila, we have three boys, two daughters-in-law, one grandson, another grandson on the way and a future daughter-in-law. Sunwest is my passion, and I enjoy coming to work every day to see what will happen next. I enjoy fly fishing, spending time in Colorado, biking and watching my boys play soccer.