Crowdfunding generally refers to a financing method in which money is raised by soliciting relatively small individual investments or contributions from a large number of people.
You may direct your STRATA IRA to invest through crowdfunding portals to participate in a wide range of opportunities including real estate, private equity, venture capital, and more.
Getting Started
First, contact the crowdfunding portal to ensure they will accept investments from a self-directed IRA. If so, the crowdfunding portal will need to provide STRATA with certain investment documentation to be sure our systems and procedures are operationally compatible.
Next, visit STRATA's Investment Onboarding page and select the asset type, Follow the directions provided to initiate the pre-custody review process and electronically submit investment information and documentation to STRATA.
Self-Directed IRA Rules
- Personal benefits are not allowed - If an investment through the crowdfunding portal offers a reward (t-shirts, music, products, etc.) you should not accept it. As with all IRA investments, accountholders should not benefit directly as a result of an investment made by your IRA or it will be considered a prohibited transaction under IRC Section 4975.
Questions
An Investor Bulletin published by the SEC provides specific details and investor education about crowdfunding.