What Assets Can Be Held in a Self Directed IRA?

Self-directed IRAs allow investors to invest in a wide variety of assets, from real estate and private equity investments, to alternative investments. There are certain rules you must abide by; such as not using any assets personally and reporting their fair market value annually.

Real estate

IRS rules permit self-directed IRAs to invest in alternative assets, including real estate and precious metals that meet certain purity standards, through specialized exchanges that work with self-directed IRA custodians. While such investments may seem simpler than conventional IRA investments, they carry greater risk of fraud.

Real estate investing through a self-directed IRA is a smart strategy, but it is crucial that investors understand its rules and regulations. A SDIRA cannot buy from or rent to disqualified persons; furthermore, paying disqualified parties for maintenance or repair services at properties owned by the IRA is prohibited; it also isn’t permissible for them to partner with disqualified people on any IRA property owned by themselves.

Precious metals

Precious metals provide a solid way to diversify a self-directed IRA portfolio during times of economic instability and inflation, offering safety in times of market instability while serving as a hedging strategy against rising prices. Experts do recommend diversifying further with assets like stocks and mutual funds as alternative investments may have limited disclosures as well as liquidity concerns compared with publicly traded securities.

Keep in mind that property owned by your IRA cannot be used for personal gain – known as “self-dealing,” which violates IRS rules. Furthermore, performing any work yourself would constitute a prohibited transaction and should therefore be left to professional contractors who will bill for their services directly to avoid breaking these rules.

Private equity

Self-directed IRAs allow investors to invest in an array of alternative assets, from precious metals (gold, silver and palladium) that meet certain purity standards to real estate and startup equity through crowdfunding platforms such as Wefunder SeedInvest or StartEngine as well as tax liens and deeds on foreclosed properties.

However, many non-traditional assets can be difficult to sell when needed and may even be subject to fraud if purchased from untrustworthy dealers. Therefore, it is crucial that investors thoroughly research any investment before committing funds – some may prefer doing this themselves while others might hire a professional advisor.

Tax liens

Self-directed IRAs allow investors to invest in an array of assets not permitted under traditional IRAs, including real estate, precious metals, private investments and tax liens. While these investments often offer higher returns than their traditional IRA counterparts, they come with unique risks that must be understood before investing.

Investors with self-directed IRAs may purchase real estate and mortgages, provided they don’t violate IRS rules. An IRA cannot loan money directly to its owner or any disqualified party such as parents, children or spouses, for instance. Furthermore, it’s essential to regularly assess the fair market value of assets held within an IRA and investments property held within it.

Additionally, it’s prudent to verify the information presented in your IRA account statements – this may involve getting an independent valuation for alternative assets or reaching out to local tax assessors for help.


Self-directed IRA custodians or trustees play an essential role in protecting against fraud and unsuitable investments, acting as gatekeepers to detect any violations and sign off on transactions such as lease agreements with tenants or mortgage financing agreements for properties. Furthermore, these trustees must report the fair market value of all assets held within your self-directed IRA to the IRS annually.

Be mindful that any property held within an IRA must only be used for investment purposes and cannot be lived in, nor partnered with unqualified people or hired to perform maintenance work on it.

Self-directed IRAs allow investors to invest in physical real estate, precious metals and private equity assets – although you should carefully assess both risks and rewards before investing.

Raymond Banks Administrator
Raymond Banks is a published author in the commodity world. He has written extensively about gold and silver investments, and his work has been featured in some of the most respected financial journals in the industry. Raymond\\\'s expertise in the commodities market is highly sought-after, and he regularly delivers presentations on behalf of various investment firms. He is also a regular guest on financial news programmes, where he offers his expert insights into the latest commodity trends.

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