California residents can choose a Self-Directed IRA with or without an LLC. A Self-Directed Solo 401(k) does not need to register with the Secretary of State or the Franchise Tax Board.
California residents can contact Rocket Dollar for a Self-Directed custodial IRA without an LLC. You can hold one asset with a Rocket Dollar Gold Account for $600 to sign up and $30/month.
If you invest in one asset, you enjoy the same pricing as all Rocket Dollar Gold Customers. $600 one-time signup fee, and then $30/month. Please contact our sales team if you aren't sure which structure is best for you. 1-855-762-5383. This structure could have additional requirements for deal approval, and forgo the benefits of an LLC, but avoids high LLC fees from the California state government.
Can I buy a Rocket Dollar with direct custody at Core pricing for $360 and $15/month?
No, not at this time.
How does the pricing compare for my options?
California based resident IRA LLC
- $360 Core account signup (one time)
- $15 per month compliance fee
- $800 minimum each year paid to California (please check with the California Franchise Tax Board for the exact amount)
- Colorado LLC does not get you away from the California franchise board tax fee.
- $70 one time fee to register your Rocket Dollar Colorado IRA LLC as a foreign entity in California (please check with the California Secretary of State's Office for the exact amount)
Direct Custody IRA (without an LLC)
(Fees updated July 2020)
- $600 Gold account signup fee (one time)
- $30 per month
- Per Investment fees: We have two custodian partners. Certain customers might qualify for no pre-investment fees for investments of $10,000 or above. All other customers will pay $200 per additional investment plus $100 annual per investment.
- The gold account covers four wires per year
- Premium support and expedited transfers
- Unlimited number of investments with our custody partner, pending the custodian's deal review process
- Assets our custody partner will not approve:
- SAFE Notes
- Except for Perth Mint Certificates, any asset not based in the United States
- Any direct personal loans to another individual
- Assets our custody partner will not approve:
- Additional fees you may incur with the custodian:
I'm ready to get started. What's next?
- Sign up for a Rocket Dollar IRA at rocketdollar.com/signup
- Select DIRECT CUSTODY account for $600 and $30 a month.
What is the timeline?
With a deal review, even with a Gold Account, the Direct Asset could take up to 3 weeks.
California residents can decide to open their IRA with an LLC but should be aware of additional costs.
California residents using an IRA with a California LLC must pay the annual California Franchise Tax Board tax/fee.
If you use another state's LLC, you must register the other state's LLC as a foreign LLC, pay the California Foreign Registration fee, and pay the California Franchise Tax Board Fee.
You will be responsible for paying and registering your IRA LLC.
I think I can avoid this $800 fee...
Can the franchise tax board really reach out to business activity out of state, if I'm investing out of state?: California's Franchise Tax Board has surprisingly far-reaching law and authority. They have backed this up in numerous court cases. Other states and legal experts have questioned this authority, but so far, it has held up in California high courts over numerous cases.
What if I open an IRA with a trust?: After consulting our legal teams, an IRA with a trust does not have nearly the same amount of case law to support it compared to the IRA LLC, which has several prominent and landmark cases to support do's and don'ts inside of a Self-Directed/ Checkbook IRA LLC.
Can I still purchase an asset?
Keep in mind that you will have to complete a deal review with our custody partner if you choose a direct custody IRA. Because our custody partner has custody of the asset they can decide if they will accept the investment or not.
Currently, at this time, our California custody partner is not accepting deal reviews for Cryptocurrency and will not hold those investments. You would need to use our LLC product.
If you still want to purchase crypto, you can always do so in California but at this time must pay the $800 yearly franchise board tax fee and register the Colorado LLC that Rocket Dollar would open for you. We are continuing to work on solutions for Crypto investors.
What about a Self-Directed Solo 401(k)?
A Self-Directed Solo 401(k) is a trust, not an LLC, and thus the extra LLC considerations do not apply. California residents can enjoy the same Rocket Dollar Core $360 signup and $15 per month fee, with no new investment fees. This can be a great alternative if you qualify.
Want to read more?
- Interested in avoiding the LLC considerations and are self-employed? See how setting up a Rocket Dollar Self Directed Solo 401(k) can increase your contribution ceiling and shield your hard-earned income from taxes!
- Why paying these additional LLC costs could be worth it. See how the Rocket Dollar team is using their accounts.