Trade futures in IRA account

Discussion in 'Taxes and Accounting' started by YoungTiger, Oct 29, 2014.

  1. Just noticed IB allows you to trade futures in the IRA account, so can we save tax to trade futures in IRA? Thanks for advice.
     
  2. xandman

    xandman

    That is correct. Most IB and FCM's allow for IRA trading, although some don't offer IRA accounts. In that case, you will have to get a trust company to open an account"

    "XYZ Trust FBO YoungTiger"
     
  3. loyek590

    loyek590

    just be aware, probably, margin calls are extremely rare at ib due to the fact that the computer closes you out before you owe them money. But still, in a fast market it's not impossible. So, if you have maxed out your IRA and ever got the dreaded margin call what would you do? You can't add anymore to the account.
     
  4. Thanks Andaman. I have been with Interactive Brokerage for many years, just swing leveraged ETFs, but don't know we can trade futures in IRA. Seems like not too many people trade their IRA, possible afraid of losing their retirement fund, but money is money, does'nt matter it is from regular account or IRA.
     
  5. Good point loyek590. I am always conservative, even in my regular account, I only trade 1 ES per $20,000. This should be safe. Thanks.
     
  6. loyek590

    loyek590

    yes, well then you can save a ton trading tax free. Most consider IRA to be your safe money, and personal to be more speculative. Just the opposite is true. Better to trade away in a tax sheltered account. Keep your serious retirement money in a low cost low tax index fund.

    I don't know that much about it. Are you 100% sure they will let you trade on margin in an IRA? They may allow you to trade a futures contract only if you can cover it without going on margin. I forget where to find the info, but one es today at these levels must be getting close to 100k. So that would be more like 1 es per 80 to 100k.
     
  7. Go to your broker and just ask them what trust company they use for IRA. Each trust company will have its own rules. You open an account with the FCM and with the trust company. The broker will restrict the account based on the trust companies instructions. It is not a perfect system but if you are intent on trading in an IRA it can be done. As an aside, I would only consider this if you are a proven trader that is confident you can make money. There is nothing worse than losing money that is already tax-advantaged.
     
  8. Thanks a lot CH. Sounds like more complicated then I thought, May just continue to swing leveraged ETF.
     
  9. GTS

    GTS

    Yes, IB allows future trading in IRA account...I've been doing it for years.

    Regarding margin, futures trading doesn't require a margin account since you don't borrow to trade futures; as long as you meet the initial and maintenance requirements for the contract (which are low) you are fine - you do not have to assets in your ira equal to the nominal value of the future contract you are trading (e.g. ES $50 x 2000 = $100,000)...normal futures margin rules apply (for ES $2875 initial, $5750 overnight)
     
  10. Handle123

    Handle123

    Mid 90s my CPA turned me onto taking retirement monies into LLC. Here is a site that explains.
    http://www.checkbookira.com/faq.html

    Adios trustee, you can do so much more with it.
    It can have rentals, businesses, tax lien notes, trading accounts, just can't do life insurance that I know of or collectables like paintings or old wine, but they may have changed some of definitions, when in doubt call a tax lawyer.
     
    #10     Nov 1, 2014