Can an Investor Make an Investment in a Startup Through an IRA?

Can an Investor Make an Investment in a Startup Through an IRA?

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The short answer to this question is yes, but (and there almost always seems to be a “but”) doing so could result in taxes and penalties if the investment is deemed a “prohibited transaction.” It is not uncommon for a startup founder or a founder’s family member to want to invest in a startup using assets from an individual retirement account (IRA). Prior to doing so, however, the founder or family member must determine whether making the investment with funds from an IRA would be a prohibited transaction in order to avoid adverse tax consequences. 1 What Is a […]

Can an Investor Make an Investment in a Startup Through an IRA?

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