A Special Purpose LLC is a limited liability company (aka LLC) that is formed with a special purpose in mind. Often, the organizational documents of such an LLC are modified for its specific purpose. There are many potential special purposes for which an LLC can be formed, but this web site will focus on one:

Investing retirement funds

This includes investing IRA, 401(k), and other retirement funds.

According to the IRS web site, "…IRA trustees are permitted to impose additional restrictions on investments. For example, because of administrative burdens, many IRA trustees do not permit IRA owners to invest IRA funds in real estate. IRA law does not prohibit investing in real estate but trustees are not required to offer real estate as an option."

Although most IRA trustees (aka custodians) disallow investment into all non-publicly traded securities, there are a few less restrictive custodians who allow investment into real estate, mortgage notes, private companies, and other alternative assets.

A special purpose LLC is often used to facilitate investment transactions involving one or more IRA, 401(k), or other retirement account. See special purpose LLC uses. Inclusion of such a structure can be very powerful, thus many companies have materialized to sell the special purpose LLC.

USING THE SPECIAL-PURPOSE IRA LLC STRUCTURE: