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In a message dated 98-04-26 21:18:33 EDT, you write:
<< How about making an entity, which will borrow money from the IRA to trade.
The entity will then pay back the amount plus interest to IRA. It may also
pay back a percentage of the gains. Then the entity will take deductions, IRA
will keep the income which will be tax deferred.
This will be a perfectly legal transection. No brokerage company can stop the
entity from trading, and IRA is totally free to lend money to the entity as a
loan.
>>
Dr. GP,
Lending money from your IRA to another entity that you control I believe falls
within one of the "prohibitive transactions" under the Internal Revenue Code.
The transaction may be "legal" in the sense that the City/District Attorney
may not knock on your door, but it may be subject to IRS tax and penalties.
William
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