With an IRA LLC you get complete and total control of your retirement funds. If you only have a self-directed IRA, your funds would be held by the Custodian, and you would have to go through them for each and every transaction/investment. With a CheckBook IRA, your IRA purchases the LLC, you are the Manager of that IRA LLC, and your retirement funds are sent to the local LLC bank account that you set up. Once that is done, you are the only fiduciary of the IRA LLC, and can direct the investments with full autonomy.
If you wanted to loan money from the IRA LLC to someone for example, you would sit down with that person and hash out whatever contract you both agree on. Then, you would write a check from the IRA LLC to that person, or simply bank wire the money from the IRA LLC bank account. You would have the authority to do all this because you are the Manager of the IRA LLC; at no point would you have to contact the Custodian for permission.
Think of it this way: your IRA makes one investment – it purchases the ownership of the LLC. That LLC ownership is then an asset of the IRA. Once the LLC is funded with the IRA money, the LLC is the investment vehicle. It is the IRA LLC that makes the loan, buys the property, opens a brokerage account and trades stocks, or invests in precious metals. The IRA sits dormant. It has made it’s one investment; it has bought the LLC ownership. Now the IRA LLC is out in the private sector buying and selling and making a profit.