Limited-Time Black Friday Deal!

An SDIRA is commonly referred to as a Self-Directed IRA, Alternative IRA, Real Estate IRA, or Gold IRA. It is an individual retirement account that provides a unique approach to help grow your retirement savings. Like a standard IRA, an SDIRA lets you save for retirement in a tax-advantaged account. Both account types also follow the same IRS rules for contribution limits and distributions.

Diversification Opportunities

An SDIRA lets you, the account holder, diversify your retirement portfolio with alternative assets such as real estate, private placements, promissory notes, and precious metals.

Flat-Rate Fees

Madison Trust’s SDIRA fees are among the lowest in the industry and are set at a fixed flat rate regardless of your account’s value.

Simple Setup and Investing Process

Setting up your Self-Directed IRA is as easy as 1-2-3! (1) Open an account at an SDIRA custodian (2) Fund the account (3) Place the investment.

When researching retirement accounts, you may have come across the term “Self-Directed Individual Retirement Account” (SDIRA). An SDIRA is a tax-advantaged retirement account that allows you to invest your retirement funds into alternative assets.

Like most investors, you likely want more information, such as: What is an SDIRA? How does investing from an SDIRA work? What is the difference between an SDIRA and a standard IRA? We’ll explore these answers and more so you can unlock your investing potential.

The majority of investors keep their IRAs at brokerage houses that typically only permit investing in stocks, bonds, and mutual funds. To invest in alternative assets, an investor must open a Self-Directed IRA at a custodian that specializes in SDIRAs. SDIRA custodians specialize in holding alternative assets and include banks and trust companies. Once you choose the best SDIRA custodian, you can open an account, contribute to it, and place an investment, just as you would with a standard IRA.

Diversification Opportunities

An SDIRA enables you, the account holder, to diversify your retirement portfolio into assets typically inaccessible in a standard IRA. Alternative assets typically provide a hedge against stock market fluctuations.

Personalized Investing

An SDIRA lets you invest in assets you know and believe in. Under self-direction, you can invest in assets that help you achieve your retirement goals.

Enhanced 
Stability

With an SDIRA, you can invest in assets that generally have a more consistent and reliable revenue stream. Popular investments include rental properties, secured promissory notes, and tax liens.

Traditional SDIRA

Contributions are pre-tax, funds grow tax-deferred, and you pay taxes upon distributions

Roth SDIRA

Contributions are made with after-tax dollars, allowing for tax-free growth

SEP SDIRA

Simplified Employee Pension IRA

Account ideal for self-employed individuals and small business owners, with higher contribution limits

SIMPLE SDIRA

Savings Incentive Match Plan for Employees IRA

Account ideal for self-employed individuals and small businesses with an employer match component

The IRS dictates the annual contributions limits for an SDIRA, which are the same as those for a standard IRA. As of 2024, the maximum SDIRA contribution is $7,000 ($8,000 if you are age 50+).

Please note that the IRS can change the SDIRA contribution limits yearly.

Prohibited Transactions

Any improper transaction between an IRA and a disqualified person.

Prohibited Investments

Collectibles, S-Corps, and life insurance.

UBIT (Unrelated Business Income Tax) & UDFI (Unrelated Debt Financed Income)

Taxes that are due when your IRA runs an active business or uses a loan to help finance your investment.

Contribution & 
Distribution Rules

The IRS puts maximum limits on contributions. There is also a minimum age to withdraw funds without penalty. If you have a tax-deferred IRA, you must withdraw funds once you turn a certain age.