Investing with Your IRA is Allowed

You can have your IRA invest in a firm in which you serve board.  Doing so isn’t a prohibited transaction, a district court says to an investor who had his IRA buy a 5% stake in a company and who subsequently joined its board.  After the director went bankrupt, a creditor tried to grab the funds from the IRA, claiming that the director had engaged in a prohibited transaction with the account.  But the court said using the IRA to buy a minority stake is allowed (Nolte, D.C., Va.).

From: The Kiplinger Tax Letter, May 2015


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