Forex
Trading IRA
A Forex Trading
IRA is a special Individual Retirement Account (IRA) that is set up
to trade currencies. This is a big advantage for traders that want to
day trade tax free; something that cannot be done with stocks. Forex
IRA's allow investors an opportunity to diversify into the largest financial
market in the world (foreign exchange) without having to worry about
taxes.
Any trading profits generated inside the IRA grow tax free. To read about the differences
between trading currencies using a traditional IRA and a Roth IRA, click
here. You can also go to the Managed
Forex IRA section if you are interested in opening an FX managed
account inside an IRA.
Instructions
to open and fund a forex IRA or transfer your existing IRA?
If you are establishing a new IRA account to trade in the forex market,
transferring your existing IRA assets, or rolling over your 401(k),
403(b) or other retirement account (if you are rolling over your retirement
plan assets, also click here to
scroll down to read this important section), these are the steps
you have to follow:
- Complete our IRA information form and provide us with some basic, but important details about your particular needs.
- Fill out the
forms from Equity Trust; the special custodian company that many investors use to set up their Forex IRA's. This might include a transfer form if you are transferring an existing IRA account into your new Forex Trading IRA (the appropriate forms will be emailed to you once you complete the IRA information form).
- Complete the Forex Account forms or Managed Account forms (whether you want to set up a regular IRA or a managed IRA). These forms will be emailed to you once you complete the IRA information form.
- Mail all completed forms with a copy of your photo ID to the custodian company (all this information will be provide to you once you complete the IRA information form).
Your forex IRA account can take from 2
weeks to set up (if you are setting up a new IRA) to 4 weeks (if you
are transferring an existing IRA or rolling over your retirement plan
assets).
If you have
any questions or want us to walk you through this on the phone,
call us at 305-600-4651 or complete our IRA form.
Instructions
to open a forex Roth IRA or transfer an existing Roth account?
If you are setting up a new Roth IRA account or transferring your existing
Roth IRA assets to your new Forex Roth IRA, please do the following:
Follow the same instructions above for the traditional IRA setup. You'll just use a Roth IRA form instead of a regular IRA form from the custodian company (this form will be emailed to you once you complete the IRA information form).
Instructions
to open a SEP IRA for businesses or self-employed individuals?
If you are opening a SEP (Simplified Employee Pension) for your business
to trade currencies or to invest in a managed
forex account, please do the following:
Follow the same instructions above for the traditional IRA setup. You'll just use a SEP IRA form instead of a regular IRA form from the custodian company (this form will be emailed to you once you complete the IRA information form).
Rolling
over funds from a retirement plan (like a 401(k) or 403(b)) into an
IRA and then using it to trade the forex market.
Usually, companies that have 401(k) plans or other retirement plans
do not allow their employees to rollover their accounts until retirement
or until the employee is no longer with the firm. If you want to rollover
your retirement plan assets to set up your forex IRA and are not leaving
the company, please check with your firm's benefit coordinator to make
sure that you can do the rollover. The same holds true for government
employees and teachers that have 403(b) retirement plans.
How
to receive free training when you open a forex IRA and then deposit more than $5000 into it (the limit per person).
A common question that our customers have is, "How
can I open a forex IRA and then deposit more than $5000 in my account?" Here are some possibilities.
Solution
# 1: Transfer the assets from an existing IRA with more than $5,000 to your new forex IRA.
If you already
have an existing IRA with more than $5,000 in it, you can simply transfer
the assets to your new forex IRA account.
Solution
# 2: Roll over your 401(k) or 403(b) into a new IRA account to
trade currencies.
If you retired
or left your employer and have more than $5,000 in the retirement
plan with that employer, the law allows you to do a tax free direct
rollover into an Individual Retirement Account. If you are still
working for the same company, ask your benefits coordinator if you
can do the rollover.
Solution
# 3: Open a SEP if you are self employed or own a business.
Any employer
(corporation, partnership, or self employed individual) can establish
a Simplified Employee Pension Plan (SEP). This is true even if the
business only has one employee. The SEP allows an individual to
contribute the most money to an IRA (up to $49,000 a year for 2009).
If the employer
wants to make contributions into a SEP, the employer must contribute
the same percentage for all employees of the business who are eligible.
To be eligible, employees must be at least 21 years old, must have
worked for the business during 3 out of the past 5 years, and must
have earned the minimum required compensation ($550 for the year
2009, which is adjusted annually). When desired, the employer may
contribute up to 25% (approximately 20% for self employed individuals)
of each eligible employee's compensation. Furthermore, employers
may deduct from their taxable income every qualified dollar they
contribute to the SEP.
Ex: Let's
say you have a business and pay yourself a salary of $50,000 a year,
you can contribute $12,500 to your SEP Forex IRA.
Solution
# 4: Open a regular forex
account instead of a forex IRA.
If you cannot
take advantage of the three options above, then you cannot trade with more than $5,000 during the first year by opening a forex IRA. You might consider opening
a regular forex account instead and funding it with more than $5,000. If you would like to open a Forex account with more than $5,000, please give us a call (305-600-4651). We would like to tell you about some unique benefits you could receive.
Using a Trust Company for your Forex IRA.
These flexible trust companies charge a small fee for their services
(usually a small set up fee and annual maintenance fee). An IRA to trade
currencies has to be established with a special trust company that gives
the investor the flexibility to invest in nontraditional retirement
investments such as real estate, futures, tax certificates, currencies,
etc. There are various companies that provide these services
to investors, including Equity Trust, Entrust, and Millennium Trust. Every trust company has different requirements. Some work with most brokerage firms in the forex market and some require brokerage firms to go through the trust company's internal approval process first. Whether you want to open a forex IRA account to trade it yourself or a managed forex IRA,
please make sure that you first find out what the trust company's policy is regarding brokerage firms before you set up an account with them.
If you want to trade
currencies with any type of retirement account other than the ones described
in this section, please call us and we will put you in contact with
someone that can help you (305-600-4651).
You can also complete the IRA information request form. |
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Managed Forex IRA
Call us today: 305-600-4651
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