Webinars

with all the webinars I've gone through and masterminds and all the rest of that stuff. I was confused with a lot of the specifics on how you get, how can I get a 401k funds into my investments and stuff like that? How do I direct people to do that? And so I gave Matt a call and broke it down very nicely. So by the time we got done, I was understanding everything. We decided to put together this webinar so we could break it out for everybody. So with that, Matt, go ahead and take it away.

Perfect. Thanks a lot for that introduction. So that's actually a great way for me to segue into one of the main points that I want to make today is that directed IRAs are largely an unknown thing. to a lot of people, or at least the way we're going to talk about them today. So before we get ahead of, I get too far ahead of myself. My name is Matt Moore. I do business development at CamaPlan, and I work with folks like Chuck to help his community understand what self-directed IRAs actually are. Now before we go one step further, I always have to add the disclosure that

CamaPlan is not a fiduciary. We're not advisors. We're not CPAs or accountants, so this is not to be a tax advice or investment advice. This is purely for educational purposes only. If you are going to make any investment decisions or any tax-related decisions, we always encourage you to go do your own due diligence and seek out the advice from the appropriate professionals. A little bit about CamaPlan. We are founded in 2003, so I have over 20 years under our belt. We're in eastern Pennsylvania in Ambler, PA, near Philadelphia. And we have somewhere in the neighborhood about 7,000 clients across the country, including DC and Puerto Rico. And kind of...

Very important part of the business for the owners is going to be that customer service. They are entrepreneurs themselves, they're third generation real estate investors. They deal with plenty of financial services, people in their lives, and they don't like being put on hold or having to navigate through complicated phone trees. So they've made the service a priority at CamaPlan to make sure that it's personal. personable and responsive. And to that end, part of the customer service journey starts before an account's ever opened. It's informing people and letting them know through presentations like this or just consultations that we do to educate investors about what self-directed IRAs are so they can be comfortable about using this capital source in their investment.

The first place to start off is just what is a self-directed IRA? If you're going to take away, you know, another thing, another main point from today's presentation, a self-directed IRA is just an IRA. The self-directed part is the name that companies like CamaPlan have, you know, have given it. The industry calls it that. But even that can be a bit of a misnomer because I, for example, have a self-directed IRA at Chase. And if I open my app, it says self-directed IRA, and that in fact means I can go and invest in any kind of stocks that I want, but it's all limited to publicly traded equities. What we're talking about is a truly self-directed IRA where the investor can deploy their tax-advantaged retirement capital into alternative assets that larger brokerages like Chase or Fidelity or Schwab, and we'll talk about some of those in a bit.

before I get ahead of myself. The whole idea here is that you have your portfolio, you have assets that you want to invest in, but a self-directed IRA, a true self-directed IRA, gives you more options and more control in how you invest your capital so that you can have greater diversification, you can look at all kinds of risk profiles and hopefully obtain greater yields from being able to access a variety of different deals. The types of self-directed plans are largely similar to the kinds of retirement accounts that you'd see at a standard IRA shop. So the most common are going to be the Roth IRA and the traditional IRA. The traditional IRA is going to be pre-tax money, or as we call it, it's going to be taxing the harvest.

are able to put in the pre-tax money, you can invest it, it grows, and then when you're over 59 and a half and can take distributions, then you have to pay tax on it based upon the tax bracket you are there. The idea being that by the time you're over 59 and a half, you've retired, you're not making as much money from your W-2 job, for example, so your tax bracket's gonna be lower. And this is, you know, good for a lot of people it works, but What we don't love about that is that you as the investor you're taking all the risk you're the one who's making all the investment decisions and having to do the due diligence do all the work and ultimately you're hoping things go well, and then when they do Uncle Sam gets to go and gets to tax you on the investment work that you did

But again, for some people, that works. But on the other side, you have the tax-free side, which is the Roth IRA. So to continue that whole tax the harvest analogy or metaphor, we think of this as taxing the seed. So instead of putting pre-tax dollars in, you put post-tax dollars. then the investment can grow tax free so that when you take distributions from your IRA, you're able to take those distributions tax free. And so especially for entrepreneurs who don't have any plans to necessarily reduce their yearly income after 59 and a half, this is a great, great tool for them to not have to

fork over a bunch of money when it's time to take their distributions. It's a traditional IRA and the Roth IRA, definitely the most popular ones, but there's other accounts that we offer. You see the SEP and the simple IRAs on the tax-deferred side. Those would be if you have a company with employees. We also have solo 401ks if you have no employees but you have a business entity. We can do self-directed health savings accounts or education savings accounts. So there's a lot of things that you can do. Another big distinction on the two kinds of plans, tax deferred versus tax free, required minimum distributions.

required minimum distributions are when you reach 72 or 73. The government says, okay, we're going to look at your life expectancy and here's your age and you need to take X amount of dollars from your retirement accounts. They're forcing you to take a distribution. That's not the worst thing except if you are in alternative assets and these are illiquid assets. It's just another kind of thing to navigate through to make sure that you're going to have enough cash in your account to be able to fund that distribution that you're going to be forced to take. On the Roth side, you don't have to you don't have to take those required minimum distributions. So then making sure that your investments are liquid or that your account balances are enough. It's not as much of a concern for you because you don't have to take the required minimum distributions. So just something to think about there.

This idea of control, really with self-directed IRAs because of all the things that you can invest in, that you wouldn't necessarily be able to invest in if you were at a large brokerage. And here's some of the most common allowable investments that we see at CamaPlan, and really this is probably true for most self-directed IRA companies. Real estate I think is really king for for most of our investors. That can mean a lot of things, but in the kind of case of this call, it means investing in assets outright, so condos, multifamily, land, whatever you want to do. Adjacent to that are going to be notes and mortgages, and they don't have to be on real estate, but real estate is a very, very popular asset to lend on because it's secured.

people who are investing in real estate, they understand real estate deals and they like the debt strategies that they can utilize in their IRA because they might have people in their network through a real estate meetup or something like that where they might say, okay, I know him, I know how well he does with his deals, and I want to lend to him. But again, it doesn't have to be on real estate. It can be an unsecuritized note. It can be to a small business. It can be a lot so there's a lot you can do inside just the notes and mortgages space alone. Next we have the private placements card. So think of anything where there's gonna be like a private placement memorandum, you're signing a subscription agreement, you have a fund set up, things like that. I think this resonates very much with our investors because they have their investments.

that are maybe being managed by an advisor or they're just kind of being put into a portfolio at Fidelity or at Schwab. So they generally have a pretty passive relationship with their investments already, but they want diversification, they want hard assets in their portfolio, and they want probably better returns. So they're trying to find the balance between still remaining relatively passive, but

getting a little bit more juice and greater diversification in their portfolio. So private placements solve that for a lot of our investors by kind of achieving all the goals that they want. And then the last one is going to be precious metals, very, very, very popular in the past few years for certain precious metals are generally a longer hold. So that aligns very, very well with retirement capital. There are some things you can't do. And it really boils down to just these two. This is not the exhaustive list, but these are kind of like the two main buckets. Life insurance policies, the IRS doesn't want to see you holding those inside of your IRA and collectibles.

This is a good stage to kind of stop and say that the tax code only tells you what you can't invest in, and it names these two things specifically. And it talks about some prohibited transactions, which I'll mention on the next slide. But I say this because self-directed IRAs, therefore, are not like a new thing. They're not something that, you know, CamaPlan just came up with. They've always been allowed. IRAs have always been able to hold alternative assets. But most people's relationship with their retirement portfolio is through their 401K usually or through some kind of advisor. And so a lot of people just think it has to be stocks and bonds and mutual funds and things like that. But in fact, it, it doesn't have to be that way. And the IRS has allowed for a variety of assets to be in your IRA for decades at this point.

Now talking about prohibited transactions, so we talked about prohibited assets, the other side of that prohibited coin are prohibited transactions. This is probably going to be the thing that people need to watch out even more so than the assets themselves, and this just has to do with how investments are structured and who can and cannot invest into a deal. So the theme here is Everything needs to be arm's length between you and the investments of your IRA. Your IRA is its own entity. You are your own entity. You cannot receive a personal benefit from your IRA, nor can your IRA receive a benefit from you. Okay, so let's use a real example. Real estate's really easy to illustrate this. I own an investment property through my IRA.

and it's located in Anaheim, California and I have tourists who come through because they're going to Disneyland. Let's say one week of the year I want to take my own family to go to Disneyland. I cannot go and stay in that because it's owned my IRA so I can't get a benefit from my IRA in that way. Let's say the kitchen sink starts leaking, the garbage disposal needs to be replaced. I can't go and replace that myself because I would be providing sweat equity or benefit to my IRA. So I need to hire someone so that they went and did that. And then that person, I would pay that person money. And their compensation would be taxed by the IRS. This also applies to certain family members. Parents, grandparents, spouses, children, their spouses.

grandchildren, their spouses, so anyone of a lineal ascent or descent. So kind of just think of it as a vertical line on a family tree, for example, or another way to think about it is like how a trust or an estate. Would sort of generally be passed down, you know, vertically. So again, using our Anaheim property example, let's say my daughter is going to go to college in Southern California and my property has four bedrooms and I plan to rent three rooms out to some of her friends and then she's gonna stay in the fourth room. Because my property is held inside of my IRA, that's not allowed because she's a prohibited family member, disqualified. Family member in this case. So those are the disqualified

not all family members are disqualified. So again, using that Anaheim property as an example, if my uncle lived in the area and I wanted to pay my uncle or wanted my uncle to come and do the work, he can go and do that. If my uncle wanted to go to stay in the property, he can he can do that. So any uncle's and nephew's nieces siblings, cousins, they are all allowed to invest, you're allowed to invest in their deals, and they can also provide services that might benefit your IRA, so that's okay. And the other thing to consider here is partnering. You can. actually partner with your IRA to invest in deals. If Let's say it was a million bucks and I only had 500 grand on me. I could go to my IRA and use the other 500 grand and we could partner together. And so the property would have two owners now, me and my IRA, the disqualification rules, the prohibited transaction rules.

Those all apply to 100% of the IRA property, unfortunately, so I can't go like stay in it for half the year. I can't stand with one shoulder in, one shoulder out. But in terms of being able to access capital with my IRA to take advantage of deals, I can do it. But I can only do it with my IRA there's ways to get around some of this stuff, but I think in general, where the objective is not to ever get too cute, not to try to get too clever and do things that are maybe on the border because, you don't want to be in the gray area with the IRS, frankly. So we talked about what an IRA, self-directed IRA is, the different types of accounts, what you can invest in. We talked about the prohibited transactions.

Now let's actually take a real example of an IRA in a deal. So this is actually a deal that Chuck you're raising for right now as of August of 26. It's with TR3 Capital. And so this is like a good example of a deal that a passive investor might do. if they were looking to use their IRA money into an alternative asset they couldn't do through Schwab or through Fidelity. We're going to look at the investment assumptions really quickly. So we're just assuming $100,000 invested. It's going to be about a four-year hold. And then based upon the return projections from the pitch deck for this deal, we're assuming about $112 profit.

And then there's also going to be a loan used, financing used, about 86% loan to cost. And I'm going to touch on that in a couple minutes, but let's keep going. So we have our gross return of about $112,000 or $111,805. Now, if we look at personal funds, so using non IRA money, we're going to get hit. with regular income tax, and we're assuming this person is at a 37% tax bracket, we're going to get hit with capital gains tax of 20%. There's going to be a recapture tax of 25%. So there will be depreciation that we benefit from if we're using non IRA funds. But when the property is sold, we'll have to pay some of that back through the recapture. And then the last is the NIIT at 3.8%. So altogether that knocks down our 112 profit down to about $82,000. If we go over to the Roth IRA side, we start with the same amount of profit, $111,805. There's no income tax, there's no

recapture tax, there's no capital gains tax because this is inside of an IRA so those are going to be either deferred or they're going to not exist since this is a Roth IRA. There is going to be a tax called UDFI and what UDFI is called Unrelated Debt Finance Income. So the tax is actually Unrelated Business Income Tax and UDFI is the trigger for that unrelated business income tax. So I just got done telling you earlier like, hey, if you use these IRAs, they'll be tax-deferred or tax-free and everything will be hunky-dory. That's mostly true, but there are these instances where you can have to possibly pay tax, which is the unrelated business income tax. And so there's two triggers for unrelated business income tax. One is when you're

If you own a business and it has operating income, rent is not considered operating income in this case, but if you bought to be really simple, if you had a, if you bought a lemonade stand and you're selling lemonade for profit, that would be profit, that would be profit to your IRA. And so because these are retirement accounts, they're not meant to be running businesses. The IRS says, ah, that's not really how this is supposed to go. So you, you have to pay tax. Next bracket. That doesn't apply here, so we're just going to kind of ignore that for a second. The other trigger is what I mentioned earlier, unrelated debt finance income, UDFI. This is when you're using a deal, whether it's a deal that you're owning outright inside of your IRA, or if you're investing passively, like in this TR3 deal, and you

So the IRS says, OK, we're going to look at how much debt is being used, the ratio of debt that's being used, which is about 86%. And so we're going to take 86% of your profit, and we are going to tax that. And the way it was actually explained to me recently is very, very good. It's basically the loan is like a partner. Your IRA is using a partner called a loan to take advantage of this deal, either to buy the property or as part of the fund or deal that you're investing in. So just think of this loan as being a partner, and that partner is not an IRA. And so that partner doesn't get the same benefits of an IRA.

kind of maximize your profit by 86%, then that 86% of the profit is going to be taxed. Well, that's not good, but at least it's only 86%. Another good thing about good, good thing about this situation though, is that although in an IRA you don't receive depreciation benefits from, like you would in a non-qualified count, non- IRA, You can use depreciation on this leveraged portion of your of your deal. So the 86% that I'm talking about so Because your loan is your partner and it's not an IRA You can actually use depreciation to reduce your UBIT liability so that brings this all this whole UBIT thing down to about $14,000

So we have to pay that tax from the IRA, but our profit still at the end of the day is almost 15,000 more or almost 16,000 more than it is in the non-qualified account. So this is supposed to be a high-level webinar. I want to keep it basic, but I like to go into the weeds on UBIT because I think it's a little bit disingenuous if I just kind of like skip on through. So that's UBIT.

That's what it is. This is the deal, but I kind of just want to show you this example of how a deal can look like when you're using an IRA versus non IRA funds. Now to wrap it up, I just want to go through the process to even do one of these investments. Step one is opening and funding your account. You're going to open your account. You can open it online on our platform. It takes about 20 minutes. you tell us your name, beneficial information, address, date of birth, things like that. You also indicate how you're gonna fund your investment and then you fund it. So typically for investments of kind of like the size that I showed you earlier of $100,000, you're gonna be funding it from a rollover from an old 401k or a transfer from an existing IRA. And that process from getting the money from one

custodian or plan over to us takes about two weeks. It can go faster but we say give yourself about two weeks. Once we have the money in the account we want to get the investment paperwork taken care of so we will work with you if you're buying real estate or we'll work with you and the investment sponsor if you're investing in a private placement for example. And the key here is that in a lot of cases the investment has to be titled to your

IRA number one and often we have to be the ones who sign the investment paperwork on behalf of your IRA. But when if you're working if you're investing into a deal like a fund or something we always try to work with you or work directly with the sponsor and fund manager to help make this process easier on you. And then the other piece of paperwork is called an asset purchase directive. This is just an authorization form that says from you to us that you want us to invest this money into this deal on your behalf.

So we have the account funded. We have the investment paperwork completed. And then we have that authorization form, the asset purchase directive. We wire the funds over in about 48 business hours. And your investment is funded, and it's off to work. And so anytime there's distributions or return of capital or just any major capital event, the money goes back into the IRA. It doesn't go directly to you. Just like dividends in a stock, they would go to your IRA, same kind of thing. And then you'll be ready to make your next investment once that investment's done. In summary, what we do, first and foremost, we're checking a box that's required by the IRS. So to have an IRA, you can't just do it yourself. You have to have a third party administer or custody of the account. And that's what we do.

We are a neutral third party. So I mentioned in the disclaimer that we're not fiduciaries. We're not able to give any kind of financial advice. But we look at that as a plus because we're not going to try to sell you on any investment or try to put you into any investment. We're going to try to sell you on using self- directed IRAs, definitely. But we're never going to tell you where to invest your money or what. but is the latest and greatest fund that we think you should go and invest in. So we're going to be a neutral third party when we talk to you about your IRA. And then to that end, we know the conversation doesn't always just exist between you and us. There's CPAs, there's advisors, there's folks who want to know what's going on because they're looking out for your portfolio. And so as much as we need to talk to your financial team,

we are happy to do it. And we would like to try to be a member of that team to make sure that everyone's on the same page of what's going on in the sited portion of your portfolio. We keep records of everything and file the necessary paperwork with the IRS when that time comes. And at the end of the day, like I said, we just want to be part of your core team of professionals who are servicing and looking at your portfolio. So with that, That's pretty much it. Any questions, Chuck? Or Brandon? Go ahead, Brandon.

Awesome. Thank you for all the info. Very cool. So I've got a self-directed IRA. It's a checkbook, LLC IRA. But I was kind of always under the impression that actively managing a property that you invested in with your IRA kind of risks some of those prohibited transactions or prohibited actions. Absolutely. So what are the criteria for how actively involved you can be in a property that you... Invest in with your IRA like in terms of if I could have my partner on a on a multi-family acquisition something like that if you've got a team of people that are that are managing that property and you want to You know bring your portion of the capital from your IRA. How would that work?

So I will tell you in That example that you just laid out right now like your GP on a deal We would just say don't do it like you shouldn't do it the IRS is going to look at two things. They're going to look at your ownership on the deal. And if you're 50% or more owner personally, then it's, it's a disqualify, it's a prohibited transaction. Or if you're less than 50%, but you're making day to day decisions, then you'd be seen as being in a place to give your IRA a benefit. And so kind of like what I was saying earlier about like, you don't want to get

too clever, too cute. One of our owners like to say, you don't want to get these things because I've seen people say like, Oh, well, you know, I won't really be making decisions. I mean, I'm still a member of the GP team and, but I'm really, this is my area and that doesn't really, it's not like a day to day thing. If the IRS comes, happens to look at the property, see that like on the operating agreement, your name is listed there. They're going to want you, they're going to want to know more and it's going to, the burden is going to be on you to, to make it clear that you weren't in fact, whatever you say you were. And so it's just like, and they could still be like, no, that's disqualified. So, I would say don't, don't do it is the, is the way of saying it with the individual property. yeah, you don't want to be managing it. So, um, so you really should have

a management company who is doing all of that for you, including obviously handling like lease up, managing any kind of improvements or repairs that need to be done and cutting checks. That should all be happening at an arm's length, so that you're truly as passive as you can be, and you're seeing the reports or just the communication about the property. They're providing that to you, but you're not sitting there and saying, hey, I'm going to be interviewing tenants with you guys for this property. The question comes up sometimes is like, well, how will the IRS know? I don't pretend that they're watching every property or at least not yet. Pretty soon, maybe they'll have a drones flying around,

and they will be, but do I think that people are following everything to the letter on this stuff, especially frankly with checkbook control IRAs? No, I don't. But I can tell you as the IRA company, like just keep your nose clean and keep everything arm's length.

Perfect. I've had other people that are looking to actively invest get the impression that their IRA or their self-directed IRA is easy access because a lot of people will have most of their available capital in IRA or some kind of retirement account, and they all want to be GPs, which is awesome. But I've been cautioning people against the expectation of being able to use those funds for active investing, and I'm glad to have an expert here to ask for clarification on that. I appreciate your response.

You're a good investment provider, investment sponsor for saying that because it's like, it's not worth it, and it's certainly not worth it to the person who's trying to do it, but even the other GPs who are on there, I could easily see them getting pulled into the burden of having to not defend, but try to clarify things to the IRS. That's literally just the effort to what you might get caught up in. The IRS very well can see it the way they're going to see it, no matter what you say, so just say like, just don't do it, it's not worth it. On the lending, the stuff I was talking about, the lending and mortgage notes, that card, I have seen that become very popular with real estate sponsor specifically.

We do a lot of work with REIA groups in the Northeast or real estate meetups, and I see the notes and lending area become very popular with them because you have these real estate investors, they love the depreciation, and they can do all these fancy things with it, and or they have their own contractor's licenses, so they are used to being very self-sufficient. They say, oh, I can invest in real estate with my IRA, that's awesome, and then I say, well, you can't do this, and you can't do this, and they're like, oh, that's not as great as I thought, and I like having that control, but you're telling me that I can lend on it, and I know Brandon from my meetup, and he's been going to, we've been going to the same meetup for five years, and he knows my kids, and I know his kids, and we're like, we go to church together, whatever it is, right? And I know he's a stand-up guy,

and I know he does deals, and I do the same kinds of deals. I'll just lend money to him, like that, for a lot of those investors, that just kind of makes a lot more sense, and then the same thing goes with funds and stuff, okay, oh, Brandon, he's doing a syndication, yeah, I know what he's been doing, he's been doing that for years, I'm just gonna invest in a syndication, rather than feel like I'm missing out on something, because I'm trying to do my own deals with my IRA. Now, that's not to say that people don't do it, but I've just kind of seen that roller coaster of emotions happen, where people are like, oh, this is great, and then like, oh, I don't know about this, and then they kind of settle on lending, or passively investing with people that they know.

Awesome, yeah, I certainly don't fault them for being excited about the idea, because that was me at some point, I was excited about that idea too, and I'm glad that I sought out people like you to clarify the finer points of it, because it's not nearly as cut and dried as it's often presented, so I appreciate that info.

Yeah, well, and the flip side is that, of that example I just gave you, I'll tell you a firsthand experience from one of our owners, Carl, is he, before he, I think he was in a property that he owned outside of his IRA, and he was painting or something, and so literally like, because he was there that Saturday or something, he... And he missed it because he was managing one of his other properties and saving really how much money was he saving doing his own painting versus what kind of return did he miss on this property that he wasn't able to buy because he missed the sale. And so perspective, he's like, I should have just had a manager handling that anyway so I could do what I do best and just handle things on the transaction side.

Then if you take that perspective then Having the manager of your the property manager of your non IRA deals and easily just become the property manager of your IRA deal of your qualified account deals And so then it's all kind of a cohesive portfolio are really good for is that passive investing. Investing as an LP in and syndications or investing as an LP and say a debt fund or triple net lease or any number of other things. It really is arms length because by definition limited partners don't have any input at all. So they're kind of shielded from all those consequences.

The one question I popped up while you were talking earlier about using the depreciation to offset the leverage portion. Yeah. Does that apply to the capital gains of the exit too? Can you use depreciation to offset those?

So any UBIT that is being assessed can have depreciation to offset it. Now it does come down to, it's a CPA thing, it's not a camo plan thing, it's a CPA thing to be able, it's not actually, it's not a CPA thing, it's a sponsor. thing to be able to, actually kind of issue that on the K one. and so that when I talk to investors, I say, you know, kind of a sign of a good fund manager is when you ask them, like, what do you, how do you handle the UBIT?

two GPs who do they do self storage and they have they're able to use depreciation and wipe out UBIT completely for their or basically completely for their for their investors. So they have a they have an accountant who has a clear plan to do that and to incentivize people to use self-directed IRAs.

You need to be sure that you have professional advice on how to structure the entity and the paperwork and everything, so that's a benefit you can offer to people who are investing in IRAs. I've seen PPMs and subscription paperwork that will say, you investors, since you're investing with an IRA, will you agree to waive your portion of and I think the implication there are some, or the, you know, people sometimes take that to mean that depreciation isn't really useful inside the IRA. And from what, from what you're telling me, that's not necessarily true. And that, that can, there are some opportunities there. There, if you have the right professional advice.

Correct. And in those PPMs, I, I'm just guessing that it's just sort of like a templated thing that, you know, one attorney is using to the next. And so it doesn't like, it doesn't completely disallow the sponsor or I guess the sponsor and their tax person to apply depreciation to UBIT but it's certainly a good thing to look out for in the fine print and it's a it's a great way to take temperature on the sponsor when you're asking them about UBIT and to be fair

if they don't have like an answer outright, that's okay. But if they should be able to get you an answer, they should be able to have a plan, at least. And their, their tax person should be the one who's providing that. So, you know, cut them all, you know, they should be cut a little slack, but they should be able to tell my accountant for the fund is handling this. So nice. Yeah. I wish they could like, I know, I know. I've met CPAs who are, I guess you'd call them, self-directed IRA specialists. Are they special alternative assets held inside of IRAs? And then I've met CPAs who I say, like, oh, I work for a self-directed IRA. Oh, I don't know about that UBIT. And they're just like, you know, they're both in this large CPA bubble, but you have two different perspectives.

when investors are preparing to make these investments, they should know that their tax professional can file, can review these correctly. And if they don't, that's fine. They just need to find another tax professional. And we can always help with that for the individual investor side.

Awesome. I love that. I think I had one other question about And this may or may not be something that's in your wheelhouse, but you mentioned solo 401ks early on in the presentation. What sort of business circumstances or entities would qualify for something like a solo 401k plan? If you just have an LLC that's not necessarily profitable yet, say it's the first year, you're singing a bunch into startup costs, and you don't have a bunch of revenue, and you're basically the only operator or one of two managing members of the LLC, is that an option for someone like that?

It can be an option. The rules are that you can't have any employees. Your spouse can participate in the program too. I mean, there's lots of people who who do that because they plan to be profitable one day right but a lot of why people have solo 401ks is because they want the additional contribution that the company is able to make and the company can only make x amount of contribution i think it's 25 of the profit up to like 35 000 or something like that i forget the exact numbers but uh

So two takeaways there is your company has to make profit, obviously, for the company to make contributions. You can still make contributions as the employee, but your company has to make contributions. You have to be receiving some compensation from that company in order to qualify to make those contributions. But the other thing is that people think, oh, I'm going to immediately invest every dollar of profit into the 401k plan that every dollar of profit that the company makes and it's that you can't do that you have to has to be it's only a percentage of the profit that the company makes but you can still contribute quite a bit as just the member like up to $25,000 or so almost three times more than the annual contributions that you can make as an IRA holder and the solo 401k

doesn't get subject to UBIT. So that's another good thing. There's greater startup costs and management costs. You have to have a plan and there's things like that, but those are basically like, mostly those are kind of like set up things that you'll set up fees that you'll need to pay up front. But yeah, it can be, it can be an effective thing. And coincidentally, my coworker he had like a side business and so he set up a solo 401k to go with it and it wasn't it never like business never really took off it kind of mutated into something else but it was like he had this idea he was going to go down into like doing a consulting thing didn't really come out to how we wanted it to be but he has a solo 401k and he

put in all the time and effort and money to set that all up. And so he still uses it, and he still gets the benefit of getting more money and investing in deals and having a UDFI UBIT from UDFI waived, because it's a solo 401k. So it can be a pretty powerful tool.

Awesome. Great. OK, last question. If someone with a self-directed IRA wants to invest in one of Charles' deals or one of his funds, about how long does it take for, say, a brand new account folder to set up an account and have that money in Charles' hands for a closing?

Yeah, great question. So someone often will, like, you know, see this webinar that Charles is talking to him and They say, okay, yeah, I want to learn more. And then they talk to me and they say, okay, I think I want to do this thing. And then we have a conversation. They say, yeah, I want to do it. So let's say today, August 26th, yes, I want to do it. Opening the account, 20 minutes, moving the money from another IRA or a 401k, about two weeks to get the money invested. Give that about another week for them to spend paperwork. So I say three weeks.

Investment sponsors call it four weeks, because they know how investors are. So yeah, it takes about 30 days or 28 days or something. So I used to actually work on the capital raising side and would give. I would raise money for a debt fund. And so I usually gave people about 25 days. And on day 20, I started kind of following up to be like, OK, hey, where are we? It can move a lot faster than that if the investor, for example, follows up with Fidelity or they talk to ADP or whoever and they're kind of nagging them along. If they put enough pressure on them, it can actually go pretty quickly. And I've seen investments get funded in two weeks, but in general, realistic days.

Outstanding.

And I'm saying that sounds better than 30.

I really appreciate all the responses. I'll stop monopolizing the Q&A and let you guys go about your day. Thank you, Matt, and thank you, Charles, for putting this on. I appreciate it.

Yeah, you bet. Those are great questions. So I will finish it off with my contact information. Email, phone, does it go directly to me? And then that QR code goes to my Calendly link if you want to schedule a call. Yeah, those should be evergreen if you want to reach out to me watch a recording of this, please do so and love to answer questions and Talk about how to make investments happen. All right Excellent. So that was good for the inaugural webinar Charles.

Yeah, I'm hoping You know, I was gonna ask a few questions and Brandon got them all man. Yeah, good job.