Private Placements/Private Entity investments can be potentially very lucrative. Whether you are investing in a private entity that is buying large real estate holdings or the entity is a business start up, here are the procedures on how to purchase these private alternative assets in your IRA at Quest.Funding into a Private Entity
The first step in funding this transaction is to make sure you have the vesting for the private placement/private entity correct on the documents.
Note: You are not personally investing the money; it’s your IRA that is investing the money. Thus the IRA will need to be named and vested to hold the asset. Thus, any subscription agreements/operating agreements must be vested as follows:
- Purchaser/Subscriber Name: Quest Trust Company FBO (Acct Holders Name) IRA # (Acct #)
- Tax ID # 61-1435085– Which will substitute for your Social Security number as your IRA will be purchasing units/shares in the LLC/JV/LP
- Address: 17171 Park Row STE 100, Houston, TX 77084
- We need this to show that the investment is in the name of the IRA, not you as the client
You will also need to submit Quest Trust Company’s internal forms :
1. Direction of Investment for Private Entity
2. Private Placement Instruction Letter
Along with our internal forms for the private placement/private entity, we will need the PPM, Subscription Agreement, Operating Agreement, LLC, LP, JV, etc…, before we can generate a check or wire for the funding of the investment. Please make sure all the necessary fields are completed on the Direction of Investment for Private Entity & Private Placement Instruction Letter form for timely funding.
IMPORTANT: It is up to the client to determine if the private placement/private entity investment complies with the applicable state & federal laws.
Quest Trust Company, Inc. does not provide tax, legal or investment advice and thus we cannot provide any legal documents for the creations and/or funding of your private placement/private entity. This will be the responsibility of the client to ensure the correct corresponding.
Items Needed for Funding Private Placements:
- Direction of Investment for Private Entity
- Private Placement Instruction Letter
- Copy of the Operating and Subscription Agreement / Limited Partnership Agreement / Stock Purchase Agreement / Joint Venture Agreement – signed as “Read & Approved”
- If you have received a Memorandum from LLC / JV / LP/ Stock- Please provide us a copy as well
- Wire Instructions – If applicable
- Click here for our Private Entities Purchase Packet
What to know after funding of your private placement/private entity with Quest:
A copy of all the signed legal documents must be mailed, faxed and/or emailed to Quest IRA, Inc. at the following location:
Corporate – 17171 Park Row, Suite 100 Park Row – Houston TX 77084 or,
Email – Documents@QuestTrust.com
Fax – 281.646.9701 or 972.314.9589 or 512.610.3332
The documents will be kept in a fire proof safe in Houston before being shipped for final safe keeping to our custodian which is Mainstar Trust located in Kansas.
Fair Market Value of your investment will be requested for every calendar year your Quest IRA owns the asset. Clients will be sent the FMV form to complete and then should return the form by fax, email and/or mail.
Payoffs – When the investment is ready to pay off, the client will need to fill out a Verification of Payoff or Disposition of Asset Form for Quest Trust Company’s records.
Sell Asset – Should the asset be sold to another investors you will want to fill out the Direction to Sell Form for Quest Trust Company’s records.
Submit Your Forms: All forms can be mailed or faxed to any of our locations or emailed to Documents@QuestTrust.com.
Note: At this time E-signatures are NOT accepted.
Documents completed? Submission options include:
- Mail to Corporate – 17171 Park Row, Suite 100 Park Row – Houston TX 77084
- Email – Documents@QuestTrust.com
- Fax – (281)646-9701 or (972)314-9589 or (512)610-3332
DISCLAIMER: Quest Trust Company does not render tax, legal, accounting, investment, or other professional advice. If tax, legal, accounting, investment, or other similar expert assistance is required, the services of a competent professional should be sought.