Self Directed Roth IRA
Investment Ideas
Contributions are subject to federal income tax. However, you will not need to pay taxes at the time of distribution.
If you anticipate being in a higher tax bracket when you retire, this retirement account may have significant tax benefits.
Proceeds from the Roth Self Directed IRA investment go directly to the IRA with no Federal Income Tax or Federal Tax filing.
Your beneficiary will inherit a Roth IRA.
Individuals can contribute up to the annual limit
The 2023 limit is $6,500 for individuals under the age of 50
The 2023 limit is $7,500 for individuals over the age of 50
Adjusted gross income (AGI) must be below certain limits
The IRS allows individuals to convert a Traditional IRA into a Roth IRA
Anyone can contribute with a Backdoor Roth
The contribution deadline is April 15th
Distributions are penalty-free after age 59 ½.
There is no Required Minimum Distribution.
Distributions are not subject to federal income tax
Types of Self-Directed IRAs
| Self Directed Investment | Traditional | Roth | SEP | Simple |
|---|---|---|---|---|
| Make any investment that is not a prohibited transaction |
yes
|
yes
|
yes
|
yes
|
| Income Tax Deductible |
yes
|
no
|
yes
|
yes
|
| Must have earned income to make new contributions to an IRA |
yes
|
yes
|
yes
|
yes
|
| Unlimited amount transferrable from one IRA account to another IRA account |
yes
|
yes
|
yes
|
yes
|
|
Unlimited Earning Limits * using a Backdoor Roth |
yes
|
yes*
|
yes
|
yes
|
| Qualified distributions are taxed as ordinary income |
yes
|
no
|
yes
|
yes
|
| Qualified distributions are income tax-free |
no
|
yes
|
no
|
no
|
|
Annual required minimum distribution * must start at age 72 |
yes*
|
no
|
yes*
|
yes*
|
| Passes to a beneficiary | As a Traditional IRA account | As a Roth IRA account | As a Traditional IRA account | As a Traditional IRA account |
| Beneficiary can continue to invest the funds in the Inherited IRA |
yes
|
yes
|
yes
|
yes
|
| Super bonus for all IRAs |
no
|
no
|
no
|
no
|
|
Subject to probate * No, if there is a named beneficiary |
no*
|
no*
|
no*
|
no*
|
Learn more about the other types of Self Directed IRA accounts we offer or contact us today to learn more! 312-795-0988
