My Summer Internship at Quest IRA

The summer between your senior year of high school and freshman year of college tends to the claim the title of the “best summer of your life.” Most of my classmates travel to exotic places, grasp their remaining last moments with their best friends until they depart for separate schools, or work and attempt to save in order to support their first year of college. I happen to fall in the last category – working and trying with all of my willpower to save the money I earned to use throughout my freshman year. I already knew in my mind that having a job was at the top of summer priorities; however, I did not expect to be so lucky in the opportunity that presented itself to me during my second semester of senior year.

I know nothing about self-directed IRAs. The minute I hear the term “investment” my brain automatically conjures images of the stock market. I guess it is safe to say that when I actually was hired to work at Quest IRA, no one was more surprised than me. I knew that having an internship to work for an investment company would turn a few heads and attract the right attention. I admit that I did not know what to expect – this internship at Quest IRA claimed the title of my first job. However, as an intern I started to develop skills and knowledge that I never thought possible. I did not step out of my comfort zone, but instead I was pushed. I firmly believe that this push ultimately contributed to the self-confidence that has slowly built throughout my time here at Quest.

The company’s CEO, Nathan Long, said that he loves to push his employees out of their comfort zones and make them do things that they may refuse to at first. He believes that each person deserves to live up to their full potential and will do whatever it takes to make them realize that there is more to them than what they let on. As the marketing intern, I have worked close with the entire marketing department – getting to know each individual on not only a professional level, but a personal level as well. I observe their friendly banter with each other and their professional yet amicable persona with their clients. Each one of them attempt every day to work to their full potential and beyond – courtesy of being directly under the influence of the CEO. They serve as an example to the rest of the departments – showing that if they can learn to let go of their insecurities and willingly take a leap of faith, all of us can. If they can do it, so can I.

Unfortunately, after my seven months of working at Quest, I am still no expert to the world of self-directed IRAs. However, I believe that I managed to learn something from my time here at Quest. I gained confidence in myself not only as an employee but also as a person – learning that to truly live up to my potential I must first let go of my doubts, sometimes needing a push in order to truly understand that I can be whoever I want to be if I set my mind to it. With this knowledge and new found strength, I am forever grateful to Quest IRA for not only welcoming me as one of their own, but also for showing me that I can achieve something as long as I am willing to let go.

Thank you to Quest IRA, and especially the Marketing Department, for a truly unforgettable summer and I cannot wait to see where the road takes me next.

-Abby Varona

PRESS RELEASE

NEWS RELEASE

Houston, July 9, 2015

COURT CASE REVEALS PROHIBITED TRANSACTION REGARDING THE PAYMENT OF WAGES FROM IRAS

The Future of Checkbook Control IRAs May Be in Question

Checkbook Control IRAs suffer another blow after a recent court case deemed the Terry Ellis IRA distributable, with extensive taxation and penalties.  The ruling was due to a prohibited transaction that occurred within the IRA, relating to the payment of wages.

In 2005, Terry Ellis directed his IRA, referred to as the Terry Ellis IRA, to purchase 98% of CST, an LLC designed for the business of selling used cars.  The remaining 2% of the company was owned by a non-related party, in the case Ellis v. Commissioner.  Terry Ellis served as the managing member of the CST LLC, and had some oversight in the operations of the business, relating to the sale of the company’s used cars.  In the same year, Terry Ellis paid himself $9,754 in compensation, directly from the CST company checking account.

Based on of Internal Revenue Code Section 4975(c)(1)(D)(E), Terry Ellis was involved in a prohibited transaction.  Terry Ellis served as the fiduciary of his IRA, making him a disqualified person, and unable to receive compensation.  Terry Ellis directed the CST LLC to pay him compensation, which was indirectly drawn from the Terry Ellis IRA, which funded CST LLC, ultimately benefitting the owner of the IRA, Terry Ellis.

Terry Ellis served as the managing member of the CST LLC, receiving compensation and taking an active role within the company.  Terry Ellis acted as the fiduciary to his IRA, and as such, was a disqualified person, making it prohibited that he would serve as the managing member of CST.  According to IRC Sec. 4975e(2)(G), a “disqualified person” includes an LLC, in which 50% or more of the interest or profits is either directly or indirectly owned by a fiduciary.  Both Terry Ellis and CST LLC were deemed disqualified persons, and consequently engaged in a prohibited transaction.

The Tax Court deemed the Terry Ellis IRA fully distributed as of January 1, 2005, with the full amount becoming part of Terry Ellis’ gross income in 2005, with an additional tax of 10%, based on the age of Terry Ellis.

The future of Checkbook Control IRA owned LLCs may be in question, with the ruling of this case.  Using a Checkbook Control IRA provides the ability to be the 100% owner of a company, such as CST LLC.  Changes in the industry are certain with rulings such as  in the case Ellis v. Commissioner.

About Quest IRA

Quest IRA administers Self-Directed IRAs that allow for investments in private assets, including real estate, promissory notes, private entities, precious metals and much more.  Committed to educating clients and providing a vehicle to invest in alternative assets, Quest IRA is one of the fastest growing companies in the industry.  For more information, please contact 1-855-FUN-IRAS.