Will I have to pay CG taxes if I rollover an IRA and self direct it?

Question

Will rollover an IRA account soon to another brokerage house. currently I pay only income taxes on the amount I withdraw each month, and no capital gain taxes. Will I have to pay these when I begin to self-direct the account? Also, Is an LLC the best way to set up the business?

Answer 1

You will not have to pay capital gains taxes on it.  If (1) it is a qualified rollover and (2) it remains an IRA, then you pay tax only on the distributions.  [However, if the rollover is disallowed (for example, you have the money paid to pay and miss the time window for a rollover), then it is taxable as ordinary income and ceases to be an IRA, at which point regular tax rules (including capital gains) apply going forward.]

Answer 2

If you mean a direct transfer of your IRA from one custodian to another (that's not a "rollover"), there is no tax impact.  IRAs are only for individuals, however.  You can't transfer IRA ownership to a business entity.

Answer 3

Don't even THINK of using an LLC to "self-direct" your IRA.  Only an individual can hold an IRA.