age of ownership is decided at the beginning. Any profit the investment receives is returned based on this outlined percentage of ownership. Additionally, the IRA would be respon- sible for its percentage of any expense associated with the investment, too. The best part about partnering is that there is no limit to the number of partners that can come together. You could potentially partner 10 IRAs and 10 non-IRA investors together for one single deal, allowing each account to participate and receive benefit from the investment. WHO DOES PARTNERING WORK FOR? Partnering can be beneficial for a variety of people. There are many occasions where the perfect deal is available, but the investor doesn’t have enough money in their IRA. This is where partnering with another IRA account, another money partner, or even your personal funds can help. You can pool funds together from multiple sources to make up the total cost of the purchase. For investors who are just get- ting started or have a small-dollar account, partnering provides an opportunity to participate in deals that would normally be unavailable. Even having a small percentage of a total investment allows a smaller IRA to gradually grow. Oftentimes, Cov- erdell Education Savings Accounts (ESAs) will participate in partnering due to the limited yearly contribution. It is also beneficial for account holders that have multiple IRAs. For those who want to utilize all of their accounts at once, this is a great way to have all accounts involved in one deal. Overall, partnering provides more possibilities for accounts to be involved in deals when they may not have been able to participate before.
age of ownership and you do, too. As a reminder, that percentage of ownership is decided at the time of purchase and must remain the same throughout the life of the investment to ensure there is never any co-min- gling of funds. Being able to combine funds with other investors and IRAs opens a door to a whole new world of pos- sibilities and understanding how to partner accounts can help expand your investor network. If you’re ever looking for more information on partnering or how to maximize all of your self-directed IRAs and person- al funds, speaking to a certified IRA services professional is a great place to start! Building wealth doesn’t have to be done alone; all you need is the right partner. •
CAN I PARTNERWITH MYSELF? Not only can one or multiple
accounts be partnered together on investments, self-directed IRAs can also partner with personal funds. Partnering your self-directed IRA money with your own personal money outside of the IRA is one of the best ways to generate income for your retirement account and create cash- flow for your pockets now, but it’s extremely important you are familiar with the rules so that you don’t get involved in a prohibited transaction. Partnering with yourself is not to be confused with doing a trans- action with yourself. Keep in mind that when partnering, both parties are working together to make the purchase, not transacting business between each other. As long as both parties remain on the same side of the fence, partnering with a disquali- fied person - like yourself - is doable. Understanding the rules surrounding disqualified people and prohibited transactions is crucial before enter- ing into any deals or partnerships. Just like you would with another partnership between two unrelated parties, when partnering with per- sonal funds your IRA has a percent-
Sarah Shellam, CISP, is a certified IRA specialist at Quest Trust Company and has been with the company for four years. After Graduating from the
University of North Texas with a degree in journalism, she joined the Quest team in the marketing department. Within the past year, she has taken on the position of Marketing content writer, researching and writing various educational SDIRA articles and other content. In her free time, she enjoys hiking and traveling in the tiny house she built herself.
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