What Happens if I Move After Setting up an IRA LLC?
There is a certain geographic footprint that comes with a Checkbook IRA LLC program. The IRA-owned LLC entity is formed in a specific state, after all.
If you move after setting up this type of program, you may need to make some adjustments to the entity.
How a move will impact your self-directed IRA will vary, depending on several factors. This can include where the entity was formed to begin with, what kinds of investments you’re making, and where you’re moving.
Below are some considerations for before you move — whether you’re planning on forming a new IRA LLC or operating with an existing plan.
Do Plan Investments Create Geographic Nexus?
Some types of investments are activities deemed by most states to create business nexus. Owning income-producing property or lending to residential homeowners are common examples.
If a LLC has nexus with a state, then it needs to be registered in that state to have compliance with state law and access to the courts of the state.
Registration can be accomplished either by domiciling the LLC in a state, or by registering a LLC formed in one state as a foreign entity to do business in a second state.
Many investment activities don’t generate state nexus. In that case, the LLC can be held in most any state.
Examples of these types of assets would include private placements or real estate syndications where the IRA LLC is investing in a legal entity. That entity will then have the necessary state footprint.
Exchange-traded investments such as conventional financial products, cryptocurrencies, and the like will not create nexus. Investments in foreign real estate don’t generate any US state specific nexus, either.
In most states, lending to commercial entities won’t trigger a need for in-state registration.
It’s always important to discuss topics of nexus with qualified legal counsel in the states where you have or plan to have activities.
When There is no Nexus
When nexus isn’t a concern, it’s unlikely you’ll need to make any structural changes to an existing IRA LLC if you change your state of residency.
An exception lies in situations where maintenance of a LLC the original state of formation is significantly more complex or expensive than your new state. There is a cost to moving a LLC, so you would have to evaluate the cost-benefit of such a move.
More commonly, you would need to update your address with all relevant plan vendors including the state, your IRA account custodian, and any counterparties to plan transactions like lenders, insurance companies, etc.
If you were listed as the registered agent for a LLC formed in your home state, then you will need to designate a new registered agent if you move out of state. The registered agent is a resident of the state or a state-licensed business other than the entity represented providing an in-state physical address for delivery of official notices or summons.
There are legal services companies that provide registered agent service for as little as $50 per year.
Designating a new registered agent is typically as simple as filing with the state business department. In states that capture such information, you’ll also want to provide your new address as the headquarters/mailing address. The fact that this address is out of state is not a concern.
When There is Nexus
If the investments you are making or plan to make with your IRA LLC generate nexus, then the considerations around where to form a LLC initially and what happens if you move will be driven by maintaining compliance with any state(s) where there is nexus.
Below are common pathways that may make sense:
- Leave the LLC in the existing state and just designate a new registered agent
- When nexus will remain in the original state only
- Leave the LLC in the existing state and register as a foreign entity in your new state
- When nexus will exist in both states
- Leave the LLC in place in the original state and form a new LLC in the new state
- When nexus will exist in both states and an additional desire for asset segregation is present
- Move the LLC from the original state to the new state
- When there will no longer be nexus in the original state and nexus will exist in the new stateIt’s possible there could be a delay in executing this type of move, making one of the prior options necessary on an interim basis
Example: FL Real Estate LLC
Laurie setup a Florida LLC for investing in a rental property in Lakeland. She received a job offer that require a move to North Carolina.
The Lakeland property owned by her IRA is performing well, and she doesn’t intend to sell it in the near future. She likewise doesn’t have any intention of purchasing an additional property in North Carolina with IRA funds.
Laurie will leave the LLC in Florida. She will designate a new registered agent and update the state with her address as manager.
Example – TX Real Estate LLC
Raj has an IRA LLC setup in Texas that holds a few rental properties. When he retired, he and his wife decided to move to Oregon to be near their grandchildren.
As part of his retirement, Raj freed up additional 401(k) money for rollover and wants to put that into some additional properties. He’d rather have them local to him.
He could either register the Texas LLC as a foreign entity to do business in Oregon, or form a separate LLC owned by the same IRA to split his Texas and Oregon holdings for reasons of asset protection.
Example – TN LLC in Syndications
Chad formed a LLC in Tennessee. While he originally held a rental property, he sold it and has been investing in apartment syndications. An opportunity in Georgia came up, and Chad decided to move.
He could keep the LLC in Tennessee, but the Volunteer state has a pretty hefty annual report fee of $300 and he would spend another $50 for a registered agent.
If he moves the LLC to Georgia, he will save $300 per year since an annual report is only $50 and he can act as his own agent. It makes sense for Chad to move his LLC to Georgia.
In Summary
Life can change over time, sometimes in unexpected ways. If you’re considering a self-directed IRA LLC with checkbook control, it makes sense to put some thought into where the best location for LLC registration may be based on your long-term goals.
If you have an existing checkbook IRA plan, a personal move is an important event that requires some action to keep your plan in good order.
Making changes to a plan structure doesn’t need to be complex or expensive. Keeping proper state LLC registration in place, however, is critical for maintaining the effectiveness of the vehicle.
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Quick answers to common questions
We’ll take you through a simple, step by step process designed to put your investment future into your own hands…immediately. Everything is handled on a turn-key basis. You take 100% control of your Retirement funds legally and without a taxable distribution.
YES! In 1974, Congress passed the Employee Retirement Income Security Act (ERISA) making IRA, 401(k) and other retirement plans possible. Only two types of investments are excluded under ERISA and IRS Codes: Life Insurance Contracts and Collectibles (art, jewelry, etc.). Everything else is fair game. IRS CodeSec. 401 IRC 408(a) (3)
It’s actually pretty simple. Early on, regulators let the securities industry take the lead in educating the public about retirement accounts. Naturally, brokers and banks promoted stocks, bonds, and mutual funds—giving the impression that those were the only allowed investments. That was never true... and still isn’t. You can probably guess why they kept the rest under wraps.
It is possible to use funds from most types of retirement accounts:
- Traditional IRA
- Roth IRA
- SEP IRA
- SIMPLE IRA
- Keogh
- 401(k)
- 403(b)
- Profit Sharing Plans
- Qualified Annuities
- Money Purchase Plans
- and many more.
It must be noted that most employer sponsored plans such as a 401(k) will not allow you to roll youraccount into a new Self-Directed IRA plan while you are still employed. However, some employers will allow you to roll a portion of your funds. The only way to be completely sure whether your funds are eligible for a rollover is by contacting your current 401(k) provider.
A Solo 401(k) requires a sponsoring employer in the format of an owner-only business. If you have a for-profit business activity – whether as your main income or as a side venture – and have no full-time employees other than potentially your spouse, your business may qualify. The business may be a sole-proprietorship, LLC, corporation or other entity type.
A self-directed retirement plan is a type of IRA or 401(k) that gives you greater control over how your retirement funds are invested. Unlike traditional accounts held at banks or brokerage firms that limit you to stocks, bonds, and mutual funds, self-directed plans allow you to invest in a wide range of alternative assets including real estate, private businesses, precious metals, cryptocurrency, and more.
These plans still follow the same IRS rules and maintain the same tax-deferred or tax-free benefits as conventional retirement accounts. The difference is simply in how and where you choose to invest.
No. Moving to a self-directed IRA or Solo 401(k) does not trigger any taxes, as long as your funds are eligible for rollover.
Self-directed retirement plans maintain the same tax-advantaged status as traditional plans offered by banks or brokerage firms. The key difference is flexibility—our plans are designed to give you greater control and allow for a wider range of alternative investments beyond stocks, bonds, and mutual funds.
A prohibited transaction is any action between your retirement plan and a disqualified person that violates IRS rules and can lead to serious tax consequences. Under IRS Code 4975(c)(1), prohibited transactions include:
- Selling or leasing property between your plan and a disqualified person Example: Your IRA cannot purchase a property you already own.
- Lending money or extending credit between the plan and a disqualified person Example: You cannot personally guarantee a loan your IRA uses to buy real estate.
- Providing goods or services between your plan and a disqualified person Example: You can’t use your personal furniture to furnish a rental property owned by your IRA.
- Using plan income or assets for the benefit of a disqualified person Example: Your IRA cannot buy a vacation home that you or your family use.
- Self-dealing by a fiduciary (using plan assets for their own benefit) Example: Your CPA shouldn't loan your IRA money if they’re advising the plan.
- Receiving personal benefit from a deal involving your IRA's assets Example: You can’t pay yourself from profits your IRA earns on a rental.
If a transaction doesn’t clearly fall within the allowed guidelines, the IRS or Department of Labor may review the situation to determine if it qualifies as a prohibited transaction.
Disqualified persons are individuals or entities that are prohibited from engaging in certain transactions with your IRA or 401(k). Doing so could trigger a prohibited transaction, which may result in taxes and penalties.
Here’s who is considered a disqualified person:
- You (the account holder)
- Your spouse
- Your parents, grandparents, and other ancestors
- Your children, grandchildren, and their spouses
- Any advisor or fiduciary to the plan
- Any business or entity owned 50% or more by you or another disqualified person, or where you have decision-making authority
These rules exist to prevent self-dealing and ensure your retirement plan remains in compliance with IRS regulations.
(Reference: IRC 4975)
Understanding and following these rules can be tricky, but it’s very doable. The best way to stay compliant is to work with professionals who specialize in self-directed retirement plans. They can help you navigate IRS guidelines and avoid prohibited transactions.
If an IRA holder is found to have engaged in a prohibited transaction with IRA funds, it will result in a distribution of the IRA. The taxes and penalties are severe and are applicable to all of the IRA’s assets on the first day of the year in which the prohibited transaction occurred.
Yes. While self-directed retirement plans allow for a wide range of investments, there are a few important restrictions.
You cannot invest in collectibles or life insurance contracts, and you must avoid prohibited transactions—activities that benefit you personally rather than the retirement plan. These include things like buying or selling property to yourself or family members, using plan assets for personal gain, or self-dealing in any way.
Violating these rules could cause your entire IRA to lose its tax-advantaged status. To protect your account, it’s essential to work with professionals who understand IRS regulations and can help you stay compliant.
This is a common misconception. In many cases, professionals may simply be unfamiliar with self-directed retirement plans, as they fall outside their usual scope of work. CPAs and tax preparers are trained to file taxes, not necessarily to advise on alternative retirement strategies. Financial advisors and brokers often work for firms that focus on traditional investments like stocks and mutual funds—and may not benefit from or support alternative options like real estate or private lending.
Self-directed retirement investing is legal under IRS rules—but like any specialized area, it requires working with professionals who understand how it works.
The IRS has rules in place to make sure your IRA is used only for the exclusive benefit of the retirement account—not for personal gain or to help family members. These rules can get complicated because there are many ways a conflict of interest can occur, even unintentionally.
For example, if your IRA buys a house and rents it to your mother, you might be reluctant to evict her if she stops paying rent. That emotional connection creates a conflict between what’s best for your IRA and your personal relationships, something the IRS aims to prevent.
These rules help ensure your retirement account stays compliant and protected. (See IRC 408)
Yes. Most tax-deferred retirement accounts—such as Traditional IRAs, old 401(k)s, 403(b)s, and TSPs—can be rolled over into a self-directed IRA or Solo 401(k), depending on your eligibility. Roth IRAs cannot be rolled into these accounts.
You can contribute directly from earned income, subject to annual IRS contribution limits. The method and amount depend on the type of plan you have (e.g., Solo 401(k) vs. IRA).
To take a distribution, you'll request funds through your custodian or plan administrator. Distributions may be taxable depending on your account type and age. Early withdrawals may be subject to penalties.
For 2025, the Solo 401(k) max contribution limit is $81,250 if age 60-63, $77,500 if age 50-59 or 69+, and $70,000 if under 50. Traditional and Roth IRAs have a limit of $7,000 ($8,000 if age 50+). Limits are subject to IRS adjustments.
Yes. IRA contributions are typically due by your personal tax filing deadline (e.g., April 15). Solo 401(k) contributions follow your business tax filing deadline, including extensions.
IRS reporting requirements vary depending on the type of self-directed retirement plan you have. Here’s a quick breakdown of what you need to know
Please note: Our team can help you understand what’s required for your specific account, but we don’t provide tax or legal advice. We always recommend working with a qualified tax professional to ensure full IRS compliance.
Self-Directed IRA (Traditional or Roth)
- Form 5498 – Filed by your custodian each year to report contributions, rollovers, and the fair market value (FMV) of your account.
- Form 1099-R – Issued if you take a distribution or move funds out of your IRA.
- Annual Valuation – You'll need to provide updated FMV for any alternative assets held in the account, such as real estate or private placements.
Solo 401(k)
- Form 5500-EZ – Required if your plan assets exceed $250,000 as of year-end. Must be filed annually by the plan participant.
- Form 1099-R – Required if you take a distribution or roll funds out of the plan.
- Contribution Tracking – Keep records of employee and employer contributions. These are not filed with the IRS but may be needed for tax reporting or audits.
SEP IRA
- Form 5498 – Filed by your custodian to report contributions and FMV.
- Form 1099-R – Filed by your custodian. Issued for any distributions.
- Employer Contributions – Must be reported on your business tax return (and on employee W-2s, if applicable).
Health Savings Account (HSA)
- Form 5498-SA – Filed by your HSA custodian to report contributions.
- Form 1099-SA – Filed by your HAS custodian. Issued for any distributions.
- Form 8889 – Must be included with your personal tax return to report contributions, distributions, and how funds were used.
