Prohibited Transactions

Opening a Self-Directed plan will expand your investment options beyond the realm of traditional to include many non-traditional investments. The IRS does not specify qualified investments, however, the IRS prohibits the following types of investments:

  • Life Insurance for yourself
  • Art
  • Antiques
  • Rugs
  • Gems
  • Stamps
  • Metals (except Gold, Silver & Palladium Bullion)
  • Coins (except US Minted Gold or Silver Eagle)
  • Alcoholic Beverages
  • Sub-Chapter S Corporations

Additionally, the prohibited transaction will generally involve the improper use of your plan by you or any disqualified person. A disqualified person includes any member of your immediate family (except siblings), employers, certain partners and fiduciaries. Your plan can also be disqualified for improper use of your Self-directed Account by you, your beneficiary, or any disqualified person for any of the following direct or indirect transactions:

  • Purchasing property currently owned by you
  • Using your account as security on a loan
  • Selling personal property to your account
  • Purchasing Real Estate for present use (such as vacation or second home)

As with any investment you may be considering, please consult your tax professional prior to investing.