CEO Bill Humphrey and President Catherine Wynne Host CPE Course at CPE4U: Alternative Investments in Tax-Advantaged Plans

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On Thursday, November 3, 2016, CEO Bill Humphrey and President Catherine Wynne of New Direction IRA, Inc., hosted two four-hour continuing education classes at the CPE4U office. These courses specialized in educating CPAs so that they can knowledgeably advise their clients about the important rules and benefits of self-directed IRA investing. 

There were nine live attendees and 28 internet attendees of these courses. The first four-hour course focused on the types of plans that are eligible for self-direction, while the second course dove deeply into unrelated business income tax (UBIT) and its role in certain IRA investments.

Self-directed IRAs are the largest growing segment of the retirement industry. As such, it’s important for CPAs to talk to their clients about the tax implications of their self-directed retirement accounts. 

Bill explained that any self-directed IRA provider can provide whatever assets they desire, except for life insurance and collectibles. Many providers only provide the things that they sell and can make money on. However, self-directed IRA providers like New Direction allow clients to invest in any asset allowed by IRS.

“It’s exciting to see an investor’s eyes light up when they realize they have this huge pile of money in retirement that they’ve never known they could invest,” Bill explained. 

Bill and Catherine provided plain-English meanings behind certain important IRS codes that dictate IRAs, such as IRC 4975 (rules for self-directed disqualified persons, self-dealing, and prohibited transactions), and IRC 408 (no collectibles or life insurance in self-directed IRAs). The speakers also dove into important court-cases and case studies as they pertained to self-directed IRAs, such as the Rollins Case and what defines “controlling interest.” 

The bottom line? Self-directed IRA investors need a “numbers person” to help them create a winning team: “As administrators, even if we hear an unwise investment idea, we can’t challenge it. A CPA can help an investor make good choices. Typical financial advisors are tied to the stock market, and they don’t want to help people move out of the stock market since securities sales help their income. CPAs have more freedom and can help their clients,” Bill explained.

Bill and Catherine provided attendees with tangible examples of CPA firm opportunities in relation to self-directed IRAs. Some of these examples included consulting for retirement, investment selection reviews, providing second opinions on investment choices, and personal financial planning. 

Self-directed IRAs need independent advisors for real estate and other investments. CPAs can help with this task, and they can run the numbers on potential investments. CPAs can also become educators and specialists on the topic of self-directed IRA investing, and teach continuing educational courses of their own (like Bill!). Self-direction is client driven, but clients still need help to ensure they’re choosing the best strategy for their retirement savings.

CPAs can provide bookkeeping and record keeping for entities owned by self-directed IRAs. Or they can do tax and information return preparation. Estate planning, planning for investment companies, assisting with financing and projections, and review of investments (looking for prohibited transactions) are all tasks that many self-directed IRA owners may need help with, and their CPA can provide such assistance.

Last but not least, CPAs can reach out to clients to talk to them about self-directed IRA investing. Who will tell them about these opportunities, if not their CPA?

To learn how you can attend one of Bill Humphrey and Catherine Wynne’s continuing education courses, or to simply learn more about self-directed IRA investing, feel free to visit New Direction’s education page, or give us a call today. New Direction also provides free in-person consultations with a self-directed IRA expert.

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