Doing It Right: The Two-Step Contribution Process

By Alisha Bennett

The Two-Step Contribution Process

Many clients are ready to make their contributions for 2016 or get a head start on 2017 (click here for information regarding IRA limits) but are unsure of the process of making contributions to their Check Book IRA. The process will echo the same steps that you took to initially fund your LLC; make sure that you don’t contribute funds directly to your LLC bank account.

You’ll do the following:
1. Contribute the funds directly to your IRA
2. Move those funds from the IRA to the LLC’s bank account

In order to start the procedure, you will complete a form (often called a Deposit Form or a Contribution Form) that informs your Custodian of your contribution details and send it in along with your funds (check or wire) to your Custodian. Most Custodians provide all of their forms online; but remember you can only make 2016 IRA contributions until April 18, 2017.

Once the funds have been contributed to your IRA, you can choose to leave the funds in your IRA or move them down to your LLC. To move the funds, you must complete an Investment Direction or Investment Authorization Form to request your funds are sent to the LLC. Now, you are ready to invest!

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