Quote from: Bostonbitcoin on January 19, 2014, 04:20:14 PM

Quote from: jzcjca00 on January 16, 2014, 02:40:59 PM

It's not nearly as hard to own bitcoins in an IRA as this post suggests. For about $1,500 and a small amount of effort, you can have a company like Broad Financial set up an IRA LLC for you, which allows you to invest IRA funds directly in bitcoins or a wide variety of other investments.

I'd be super cautious of the Broad Financial option....there are many similar companies which have come and gone....it's not easy to research them to get a comfort level with thier quality...The site doesn't even have much info about the company.

I've seen hundreds of people try this but never actually seen it work for anyone.

The challenge lies in the actual implementation. Sure anyone can follow IRS regs and set up a compliance LLC to be invested in an IRA....but the actual implementation is the killer. Who is the custodian? Who does the accounting? How do you segregate bitcoins out?

I might be wrong but I've never, ever seen it work for anyone other than the ultra rich through specialized family offices.

There is a HUGE market for these kinds of fully self directed IRAs for people to buy real estate etc. -- the reason NO major firm (like Fidelity, Schwab or Merrill) has ever done one is because NONE have been able to figure out how to do it. It would be a huge profit area for any firm who did so. I don't trust the small companies who say they have figured it out.

The big companies like Fidelity, Schwab or Merrill make huge money on trade commissions and mutual fund fees. There is not much profit in being an IRA custodian of an account with only one holding, an IRA LLC, so there is no incentive for them to get into the business. They want you holding stocks and mutual funds.

We know that tens of thousands of people are doing self-directed IRAs for real estate, and the IRS has removed this from the list of activities likely to trigger an audit.

One commonly used custodian is IRA Services Trust Company.

I don't yet know how much work this will be, and I can't yet say whether it will trigger an audit. I just think that shielding bitcoins from capital gains taxes sounds like a good idea. I'll know more in a year or two, but how much will bitcoins appreciate during that time? What will it cost people to wait?

I'm an early adopter, and that brings some risks!