Rocket Dollar Core and Rocket Dollar Gold

I get a debit card and checkbook with my IRA with Rocket Dollar Gold. What spending restrictions and rules should I be aware of?

Spending out of your IRA account has to be related to your investments. NOT YOU. You cannot pay yourself or write off small personal expenses for managing your investment.

What is an example of a Self-Directed Retirement account legitimate business expense?

  • Handing your debit card to a contractor, so they can buy supplies for a renovation for your IRA's property.
  • Writing a check or an ACH transfer to a manager of your property owned by your Solo 401(k).
  • Paying the California Franchise Board Tax Fee for registering your IRA LLC, an investment expense directly related to your IRA's fees.
  • Paying your Rocket Dollar account monthly fees with your Rocket Dollar Gold Debit card. 

What is an example of a prohibited transaction TO AVOID when using your debit card or checkbook?

Investors must be careful to avoid situations similar to... 

  • Meeting with a real estate broker over your IRA's property and buying Starbucks with your Rocket Dollar debit card as a business expense. (self-dealing)
  • Writing a check to your son for cleaning and managing your retirement accounts Air BnB property (prohibited transaction because your son is a disqualified person)
  • ACH transfer or check to yourself for $1,000 a month for management duties of your property (self-dealing, you cannot pay yourself any income for management duties)
  • Buying house supplies for your IRA's property by swiping your debit card, but then using the materials on your personal home or real estate business instead. (self-dealing and a conflict of interest between your personal business and retirement account)

Why does this matter?

If you make a prohibited transaction and make no effort to correct it, your IRA could be distributed. This would mean you would lose ALL of your tax benefits for the entire value, plus a 10% early distribution penalty for the entire amount if you are not old enough. 

For a solo 401(k), there could be up to a 15% tax penalty applied to the Solo 401(k)