Using Your IRA Funds To Start A Business Is Very Risky
The draconian rules surrounding prohibited transactions seem a bit out of place when someone is messing with what is pretty much their own money and not really avoiding any taxes in the process. From a policy viewpoint I could see a paternalistic argument for discouraging retirement fund investment in speculative ventures, but the only speculative ventures that these rules discourage people from going into are the ones where they will be keeping more of an eye on things.
At any rate, the moral of this story is that you need to be extremely cautious with self-directed IRAs.
Exchange Facilitator Does Not Beat Missouri Use Tax On Learjet
So even though, the companies may have gotten the income tax deferral that 1031 is designed to yield the benefit did not extend to use tax. Presumably, it would have worked if Learjet had taken the 2004 model in trade for the 2007 model, but there are probably business reasons why that was not an option.
The important lesson here is that concepts that work in federal income taxation do not alway translate well when applied in the SALT (State and local tax) area .
Follow Me
Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.