Client Question: I have a self-directed IRA, what are the ‘red flags’ that could cause an IRS audit? My Answer: Anything the IRS can “see”. In this article, I will discuss situations where the IRS has access to information that could trigger an audit of an Individual Retirement Account (“IRA”), which in turn can lead to the … Continue reading IRS red flags for self-directed IRAs
Read MoreOn May 20, 2025, Washington state Governor Bob Ferguson signed into law Washington Senate Bill 5813, which provides significant increases to the state’s capital gains tax and estate tax. Capital Gains Tax The Washington state capital gains tax has a short, but frenetic history. Since January 1, 2022, a long-term capital gains tax of 7% … Continue reading Warning: WA state increases estate tax and capital gains tax significantly
Read MoreCheck out Warren L. Baker’s latest article – published in the latest issue of Wealth & Investments Monitor (Nov/Dec 2024). Happy holidays to you and yours!
Read MoreMy clients frequently ask, “what self-directed IRA investments have the most potential for IRS scrutiny?” While most clients think this question is related to the specific type of investment, to me, the question is more about the collateral consequences of a particular investment. IRS scrutiny is very rarely a random occurrence – instead, the IRS questions … Continue reading Self-Directed IRA + K-1 = IRS scrutiny concerns
Read MoreOn February 7, 2023, the SEC and FINRA published overlapping warnings to the self-directed IRA investors. The SEC has done this in the past, and the new warnings appear to be sort of a “reminder” that self-directed IRAs raise some unique concerns for individual investors. I absolutely agree that investors that are unaware of the … Continue reading SEC and FINRA warn self-directed IRA investors about inherent dangers
Read MoreSen. Joe Manchin, D-W.Va. (9/29/21): “What I have made clear to the President and Democratic leaders is that spending trillions more on new and expanded government programs, when we can’t even pay for the essential social programs, like Social Security and Medicare, is the definition of fiscal insanity.” Rep. Ilhan Omar, D-Minn (9/30/21): “Trying to … Continue reading The True “Insanity” of the Build Back Better Act: IRA Tax Punishment to Non-Wealthy
Read MoreOn June 24th, ProPublica’s Justin Elliott published an article entitled, Lord of the Roths: How Tech Mogul Peter Thiel Turned a Retirement Account for the Middle Class Into a $5 Billion Tax-Free Piggy Bank. The article immediately received a lot of attention, with the term “Roth IRA” (of all things!) trending on Twitter. I was particularly interested in … Continue reading [OPINION] Is Peter Thiel’s $5 billion Roth IRA legally valid? There are many reasons for doubt.
Read MoreAn article was published in ProPublica today entitled, Lord of the Roths: How Tech Mogul Peter Thiel Turned a Retirement Account for the Middle Class Into a $5 Billion Tax-Free Piggy Bank (by Justin Elliott). The general idea of the article is to call attention to extremely large Roth IRAs and how they have been used by ultra-high-net … Continue reading Warren Baker quoted in ProPublica Article on Peter Thiel’s $5 Billion Roth IRA
Read MoreAshlea Ebeling of Forbes published a piece today that features analysis and quotes by yours truly. The piece is called “Got Alternative Assets In Your IRA? Watch Out.” The article stems from the third Government Accountability Office (GAO) report on “self-directed IRAs” (i.e., retirement accounts that hold “unconventional” assets – e.g., real estate, private equity, … Continue reading Forbes: “Got Alternative Assets In Your IRA? Watch Out.”
Read MoreThe latest version of The Kiplinger Tax Letter has a good overview of some key considerations that can occur when an IRA owner takes a distribution out of his or her IRA prior to age 59 1/2. In addition to owing income tax on the IRA distribution (assuming a Roth IRA is not involved), a … Continue reading Red Flag: be careful when taking “early” IRA distributions – the IRS might check up on you
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