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#974 - 04/11/06 01:30 PM Phoenix Spirit Self Roth IRA etc methods.
EclecticGuy Offline
New Member

Registered: 04/11/06
Posts: 7
Loc: All over.
Hello all.

I did a search for "Phoenix" real quick just in case this specific company has been mentioned on this board and did not find that to be the case. I have not searched thoroughly on Self Directed Roth IRAs and http://www.phoenixspiritent.com/ related methods.

I'm going to send an email to Rob to try to encourage a thorough investigation and discussion on the methods at http://www.phoenixspiritent.com/ .

For Rob and others curious to know, I'm just another busy guy working long and hard hours to get ahead in business who is looking into asset protection and tax minimization strategies. I've done a bit of reseacrh on Rob and weighed some pros and cons to the point where I still lean toward valuing his knowledge very much and may elect to employ his services in the future.

I am currently most curious of getting all perspectives on the value of http://www.phoenixspiritent.com/ services and strategies.

I'm hoping that some people like Rob and others of you that practice law facts and theory will dig into http://www.phoenixspiritent.com/ by their site, products and phone in combination with your knowledge and resources, and disect all of the information in order to provide some helpful insight to those of us who are interested.

I'm interested in opinions on all of the methods on that site, not just limited to the Self Directed Roth IRA owned by LLC (as I recall they suggest). So, also things like Massachusets Trusts and any other thing you can dig up on the site or discuss with them on the phone.

I bookmarked their site a long time ago and it has obviously changed fairly recently. Looks like some of the links don't work properly now either. But, the information is interesting.

Just in case any of you are curious if I have ordered their "informative" products (manual and vhs tape) shown here: http://www.phoenixspiritent.com/products_manuals.html the answer to date is NO. I may in the future but I figured I'd just want a professional opinion anyways so I'll just try to get that from a forum like this first.

Thanks.

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#975 - 04/11/06 04:28 PM Re: Phoenix Spirit Self Roth IRA etc methods.
Jay Adkisson Offline
Expert
*****

Registered: 06/05/04
Posts: 1108
Loc: Newport Beach, Orange County, ...
The unincorporated business trust organization (UBTO) which is commonly known as a "Pure Trust" is a WELL known scam, see http://www.quatloos.com/taxscams/contrusts.htm

Registrant:
Phoenix Spirit Enterprises Inc

432 So. Curson Ave. 1B
Los Angeles, Wyoming CA 90036
United States

Registered through: PSADOMAIN
Domain Name: PHOENIXSPIRITENT.COM
Created on: 06-Aug-01
Expires on: 06-Aug-07
Last Updated on: 21-Feb-06

Administrative Contact:
Edgar, Richard jason@newerasolution.com
Phoenix Spirit Enterprises Inc
432 So. Curson Ave. 1B
Los Angeles, Wyoming CA 90036
United States
323-933-6252 Fax -- 323-933-6443

Technical Contact:
Edgar, Richard jason@newerasolution.com
Phoenix Spirit Enterprises Inc
432 So. Curson Ave. 1B
Los Angeles, Wyoming CA 90036
United States
323-933-6252 Fax -- 323-933-6443

Domain servers in listed order:
NS2.ZONEEDIT.COM
NS17.ZONEEDIT.COM

Registry Status: REGISTRAR-LOCK
Registry Status: clientDeleteProhibited
Registry Status: clientRenewProhibited
Registry Status: clientTransferProhibited
Registry Status: clientUpdateProhibited

Oh, and it does not appear that they are registered as investment advisors, either.

Your question: "I am currently most curious of getting all perspectives on the value of http://www.phoenixspiritent.com/ services and strategies."

My answer: Zero. Actually, sub-zero, since if you follow their strategy at least as it relates to UBTO's you will find the route to Club Fed relatively short. Is a three-year prison term and being branded as a felon worth saving a few bucks in taxes via a strategy that has failed every single time it has been attempted? You decide.

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#976 - 04/11/06 08:29 PM Re: Phoenix Spirit Self Roth IRA etc methods.
EclecticGuy Offline
New Member

Registered: 04/11/06
Posts: 7
Loc: All over.
Thank you for your input, Jay. An aside - I'd have already bought your Asset Protection book at least a year ago if I could honestly say that I'd have enough time to handle business and do anything other than let your book sit on my desk, lol. It is what it is.

I have already checked into their "whois" info. It's a habit of mine. Thanks for the care though.

I have done some delving into Common Law and apart from the scams involved I actually believe in some of it's powers that are suppressed today as I understand them. However, I'm also aware that a good deal of related actual scams AND genuine Common Law slandered as scams are both not doing too well in court these days, so I understand the value in staying away from much of that even when I consider the admirable principles that many evoke in defence of practicing such law even when it is controversial.

It was my gut feeling from first looking at the "Massachusets Trust" information that it is the most obviously controversial thing, to me, that I see on their site. Not surprised that you have made the comments you have on it. I was not aware that this was the same thing as the infamous "Pure Trust" label, but I knew it certainly seemed similar to me. Thanks for clarifying.

HOWEVER, I would not let the fallacy of that one strategy alone discourage me from their other strategies (of most interest the Self Directed Roth IRA - as this thread is titled with - and LLC combo with their "unique" methods of use). Maybe this would steer me away from THEIR SERVICES specifically, but if they have STRATEGIES that are excellent ... rarely practiced or not, and I could have a more reputable consultant who wasn't doing things with stuff like "UBTOs" that risk them being jailed ... who would help me to use the great strategies and be there for me to succeed in defense of me if questioned then that would be quite ideal.

So, back to my main interest - the Self Directed Roth IRA and LLC Combo with "unique" stregies of use.

Basically, I'm aware that there are likely MUCH BETTER people (than Phoenix Spirit) to turn to for Asset Protection, such as Jay and Rob for possible example. And, I do want to say again that I am seriously considering employing Jay's and or Rob's services. So, I'm not really interested in Phoenix Spirit for their Asset Protection strategy which seems to rely a bit on a LLC and heavily on the "UBTO/ 'Pure Trust'".

I am most interested in their Tax Minimization strategy by using the Self Directed Roth IRA with the LLC. Granted, they do also mention some combined use with the "UBTO", but that aside I wonder what benefits the other strategies have in todays legal system for Tax Minimization.

For anyone to give a really honest effort at answering as accurately as possible, you may have to actually investigate the strategy thoroughly and I hope that you do. It seems to me that there is a high chance that even if it is very legal, it may be a new strategy to the eyes of many ... even if you are a very seasoned and reputable practitioner of law in Asset Protection and Tax Minimization.

Most of my business is increasingly involved in Capital Gains from Venture Capital and various investments. It seems like these strategies could be of great help to reducing my tax burden.

From their website, I quote (please ignore the "Pure Trust" references that I now see UNLESS you have FURTHER commentary on it that is not redundant):

"About:

PHOENIX SPIRIT ENTERPRISES, INC. is a financial services corporation helping people with all aspects of personal and corporate money problems. We are CPA's and MBA's, and Attorneys with over 35 years of experience in the field and are acknowledged experts in financial and tax accounting.


Our Mission is to educate individuals in legal, but non-traditional, structural solutions to personal money problems, the implementation of which will achieve favorable financial results for the individual.


We provide a specific combination of techniques that will Dramatically lower the personal income taxes for most of you and will result in your having more spendable money for yourself and your family.

The combination of these mainstream structures when used appropriately will:
(1) Avoid most capital gains taxes, and (2) significantly avoid business and investment income tax liabilities generated by many business activities.

A second major advantage of these structures is that their use protects formerly personal real estate, business real estate and other personal assets from frivolous lawsuits by third parties and removes the individual as a party-at-interest, thereby protecting the individual from irrelevant personal lawsuits.

In the manual offered on this Web Site, we discuss the mitigation of individual tax liabilities, primarily through the creation of certain non-traditional legal structures that diffuse Federal and State Income Taxes. Our structural techniques, while 100% legal, are not in common practice. One reason for this is because the end result of the implementation of our system of segregating personal real estate, business real estate, personal assets, and income activities into protected legal structures is the avoidance of certain types of income tax liabilities; the corresponding result is that several "normal" income tax returns need no longer be filed. Many tax Accountants and tax Attorneys make their money by filling out income tax returns and find the implementation of our legal structures self-defeating to their ability to generate their own money.

We have successfully used these legal structures to save our clients hundreds of thousands of dollars in capital gains taxes (and other real estate taxes) related to the sale of both real estate and personal properties. We have also used these structures to reduce our client's business and personal income taxes by dramatic dollar amounts.

"One of the two major types of structures we use is the various Self-Directed (not Sponsored) Retirement Programs authorized by the ERISA Act of 1976. (The other major type of legal structure is the Limited Liability Company(LLC)). The provisions of Retirement Programs are administered by the Department of Labor(DOL). Most of the provisions of the Department of Labor governing retirement programs are not well known. To validate our point:


Request free information from us concerning one legal technique, to free up your IRA money now, without paying the IRS ten percent (10%) early withdrawal penalty and the IRS recovery of unpaid taxes at the time of contribution.

This technique has been authorized and approved by the Federal Government. Through this technique, you could free up your IRA and 401(k) money, now, to allow you to do what you want to do with your money.

We hope the value of this free information will induce you to order our manual to find out how you can legally avoid the payment of most Federal and State Capital Gains Taxes (for both business real estate, personal real estate, and business personal property), dramatically reduce certain federal business income taxes, legally avoid probate and have more of your money to use for what you want to do now. Additionally, the liability protection from third party lawsuits for business real estate and business personal property is significant. Furthermore, by placing personally held real estate or personally held vehicles into one of these several legal structures, the individual has eliminated himself as a party-at-interest in any lawsuit and would not be personally liable for claims by third parties occurring upon traditionally personally held real estate or for traditionally personally held vehicles.

The information gathered into this manual has been written about in many different professional, business and money journals. We have intensively investigated enabling IRS, ERISA, and DOL Codes and Regulations, which we reference. We have put together a complete information source, in one place, in which we demonstrate how certain provisions of the ERISA Act can be used in non-traditional ways to greatly benefit your business cash flow and dramatically benefit your personal finances.

After you become familiar with our concepts, our services are:
1) to consult with you to determine the appropriate legal structures for you; and
2) to establish, on your behalf, those appropriate legal structures in accordance with the provisions of the ERISA Act, USC Title 26 (the Internal Revenue Code), CFR 26 (Code of Federal Regulations for the Internal Revenue Service), USC Title 29 (the Department of Labor Statutes), and CFR 29 (the Code of Federal Regulations for the Department of Labor) and the statues of the several States of the Union.

For free information on the IRA Prohibited Transaction Rules. Click Here
Below are other links that may be of interest to you. Please visit our Links Page for more!

We specialize in forming LLCs owned by non-taxable entities. The result is that when an LLC's tax liability is passed by a non-taxable entity, the tax is totally and legally avoided under current IRS law at both the Federal and State levels. While this sounds simple (and in concept it is) the implementation can be quite tricky.

What is an LLC or Limited Liability Company?? & Why the LLC versus a 'C' or an S-corporation?
LLCs are relatively new to the United States, existing under legislative acts in 47 States, of the Union for only the last 12 years. (LLCs go back 500 years for the Dutch.) LLCs are considered to be corporations for Asset Protection purposes, and therefore have the protection of the Corporate Veil. However, for tax purposes, LLCs are considered to be Partnerships and indeed, they annually file a specialized type of Form 1065 (Partnership Return). This means that the tax liability that would normally accrue to the business entity is not taxed at the business level, but the tax liability is "passed through" to the owners of the LLCs Membership interest. Membership Interests are similar to Stockholders Interests in a corporation and are measured by the number of Membership Interest, as opposed to being measured by the number of Shares of Stock.)

The hot new organizational structure that business people and investors nationwide are rushing to take advantage of, the LLC combines all the Tax Benefits associated with partnerships with the Limited Liability Asset Protection of a corporation. Now legal in 48 states,

LLCs are considerably

• cheaper
• simpler, and
• easier to maintain

Than alternative organizational forms, including Subchapter S Corporations, and Limited Family Partnerships.

• LLCs can own subsidiary companies
• LLCs have greater flexibility in allocating profits.
• LLCs can have an unlimited number of investors
• LLCs are even better than Limited
• Partnerships for protecting assets.

YOU CAN APPLY LLCs TO:

• Operating a business
• Estate Planning
• Protecting Assets
• Real Estate Acquisitions
• Some Professional Practices, subject to State Licensing Requirements
• Avoiding Probate of Estates
• Venture Capital Operations

While you can find companies who will form an LLC and charge as little as $700 to $1,500 for you to set up the LLC in Nevada or Wyoming, the key to transferring the assets from the IRA to the LLC is embedded in the LLC Operating Agreement. Most other firms ofering incorporation in Nevada or Wyoming include an LLC Operating Agreement in the quoted price that CANNOT withstand an IRS, ERISA or Department of Labor attack on the IRA because THEY DO NOT ENCOMPASS THE REQUIRED SPECIFIC PROVISIONS OF EITHER THE ENABLING LEGISLATION OF THE ERISA AND IRC; NOR DO THEY ENCOMPASS OR ADDRESS THE TREASURY AND DEPARTMENT OF LABOR REQUIRED REGULATIONS. The provisions authorizing the transfer of assets from a Self Directed IRA to an LLC are Not well known. (We only know of four other programs in the United States that are using these provisions. They are offered by large law firms who have charged up to $50,000 for the drawing of an LLC Operating Agreement that will withstand the scrutiny of the governmental entities having oversight over IRAs.) We have spent over $200,000 in attorney's fees with the law firm of Kirkland and Ellis, LLP insuring the provisions of our Operating Agreement WILL withstand IRS, ERISA and Department of Labor attack. The quoted above includes our LLC Operating Agreement with the subject provisions.

Another unique aspect of the Limited Liability Company is the asset protection they give to the assets inside the LLC. Under most state laws, if somebody were to sue the owner of an LLC, and the individual suing won the lawsuit, they could NOT take away the assets inside the LLC from the LLC owner. Rather the most they could get is a "charging order" against the LLC.

A charging order doesn't give the individual winning a lawsuit full rights over the LLC; actually their rights are very limited. In fact, you, the IRA owner, could maintain control of the investments of the LLC even though the person who won the lawsuit had a charging order against all of your ownership of the LLC. The most they would be entitled to, would be the distributions from the LLC. If the LLC doesn't happen to make any distributions, then the individual who won the lawsuit isn't going to get anything!

A. Characteristics:
1) Jurisdiction
2) Third Party Creditors (including the IRS)
3) Disclosure of Owners (Members & Officers)
4) If the LLC loses a Law Suit
5) The LLCs Operating Agreement

B. Prepared by Attorneys:
1. Jurisdiction - Normally formed in the state of Residence
2. Third Party Creditors - Subject to casual inquires
3. Disclosure of Owners - shows names of Members and Officers
4. If LLC loses a Law Suit - Assets liened; operations impaired.
5. The LLCs Operating Agreement - Does NOT allow for return of funds to
the LLC, the Retirement Fund, and the
"Pure" Trust, defeating the purpose for
forming the LLC in the first place. Such
return is called a "non-qualified" distribution.

C. Prepared by Phoenix Spirit:
1. Jurisdiction - Formed in Wyoming
2. Third Party Creditors - Requires Formal Due Process for Information Release
3. Disclosure of Owners - Allows for nominees - non-disclosure by State
4. If the LLC loses a Law Suit - Plaintiff receives only a "charging order", allowing the LLC management to determine whether or not there is to be distribution that would be partially payable to the plaintiff. Management continues to operate the LLC unfettered by the law suit's outcome.
5. The LLCs Operating Agreement - The Phoenix Spirit Enterprises LLC Operating Agreement - DOES allow for return of funds to the LLC, the Retirement Fund, and the "Pure" Trust. Such "distribution" becomes qualified and does not break the non-taxability of the LLC, the Retirement Funds or the "Pure" Trusts. It was drawn up by a major law firm and is copyrighted by PSE. This is the principal advantage of the PSE LLC, in that the tax liability passed to the non-taxable entities changes to non-taxable, and the funds can be returned to the LLC as Operating Capital WITHOUT breaking the non-taxability of the LLC, the non-taxability of the Retirement Fund or non-taxability of the "Pure" Trust."

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#977 - 04/11/06 08:49 PM Re: Phoenix Spirit Self Roth IRA etc methods.
EclecticGuy Offline
New Member

Registered: 04/11/06
Posts: 7
Loc: All over.
For Reference, the FAQ from their site:

"1.Q: Why do I need to set up both the Special Provision LLC (Limited Liability Company) with the Legally Exclusive Operating Agreement AND the Non-Taxable Entities which entities are the owner's of the LLC?

A: Both are needed for you and your family to enjoy and avoid capital gains taxes when Capital Gains are realized; for your family to enjoy zero Business Income Tax taxed to the business entity; and for your family to enjoy substantially reduced Personal Income Tax. Most important, however, is for you to protect your family by putting a stop to litigation, judgments, law suits, bankruptcy, going to court, and spending unnecessary attorney fees. We do this through the mechanisms of erecting structures that will protect you from the IRS and other potential third party creditors. The LLC and Non-Taxable Entities comprise a System of Self-Determination; neither can work to the maximum benefit by itself. In combination, the Structures become Supercharged for Asset Protection and Tax Avoidanc.




2.Q: Where can I organize my LLC?

A: We can organize your LLC in Wyoming or Nevada and file as a foreign corporation in your home state. NOTE: The State of Wyoming and Nevada are hostile to creditors, especially the IRS. You can find companies who will form an LLC and charge from as little as $500 to $1,500 for you to set-up in Nevada. or Wyoming (you get what you pay for). The key to transferring the assets from the IRA back to the LLC (following the LLC flowing the funds tax free into the IRA) is embedded in our Copyrighted LLC Operating Agreement. Most other firms offering incorporation in Nevada or Wyoming include an LLC Operating Agreement in their quoted price that CANNOT withstand an IRS, ERISA or Department of Labor attack on the IRA. This is because their Operating Agreements do not include the required, specific provisions of the enabling legislation contained in USC Title 26 (the Internal Revenue Code), USC Title 29 (legislation dealing with the Department of Labor, which Department is responsible for Retirement Plans) - together with the corresponding "words of art" of the Codes of Federal Regulations (CFRs) - and as contained in the ERISA Act of 1974. The provisions authorizing the transfer of assets from a self-directed IRA to an LLC are NOT well known. NOTE: We know only of four other programs in the United States that are using these provisions. They are offered by large law firms who have charged up to $50,000 for the drawing of a LLC Operating Agreement that will withstand the scrutiny of the governmental entities having oversight over Retirement Funds. We have spent over $200,000 in attorney fees to insure the provisions of our Copyrighted Operating Agreement WILL withstand IRS, ERISA, and Department of Labor attack. Our LLC Copyrighted Operating Agreement is included in our fee. Please call for Fees.




3.Q: How can I get started?

A: One of the practical problems in establishing a "true" Self-directed Roth IRA is finding someone to do it. The security firms, banks, and insurance companies offering the standard non-self directed ("sponsored") IRA do NOT offer the self-directed IRA because they have typically not made the appropriate arrangements with the State in which they are incorporated to qualify to offer the self-directed IRA. Self-directed IRA's are expensive and can expose the financial house to risks, thus the management does not wish to go this route. The liability of having many different individuals making decisions on their individual IRAs investments without the approval or veto power of the institutions results in prohibitive liability insurance premiums for the securities firms, banks and insurance companies, moreover, the financial risk is unacceptable to their management and shareholders. The fees for the Self-directed IRA vary by circumstance but can amount to approximately twice the Sponsored Traditional IRA and Roth IRA fees and are therefore still nominal (no more than $500 per year for all services [more services are required for the self-directed IRAs than for non-self-directed IRAs]). We know that the normal set-up fees for the standard non-self-directed IRAs are small and are sometimes totally waived by the securities firms, banks, and insurance companies offering the sponsored IRAs. However, those sponsored IRAs offer NO protection against the IRS seeking to garnish the sponsored IRA. Furthermore, there are strict bonding requirements for self-directed IRA custodial accounts imposed by the States of California, Nevada, and Wyoming that make the self-directed IRA. The initial set-up fees per IRA are $325.00 per account. Typically, husbands and wives will require their own individual self-directed IRA, as the IRS mandates separate Roth IRAs for spouses under the most common circumstances. We can also organize your Special Provision LLC with our Legally Exclusive, Copyrighted Operating Agreement. Our inexpensive System of Self-Determination provides Tax Avoidance of Capital Gains Taxes, realizes zero Business Income Tax (to the LLC), and minimizes Personal Income Tax. Further, our program provides Asset Protection; the result is protection from litigation, judgements, lawsuits, bankruptcy, going to court, and the elimination of unnecessary attorney fees related to the foregoing items.


4.Q: Can I use my current broker to make investments in the Legal Structure Program?

A: In most cases, your current brokerage house will NOT act as the custodian of your self-directed IRA. This is especially true if you wish the IRA to invest in non-publicly traded securities such as your LLC. That is why we use "true" self directed IRA custodians to hold title to the LLC. You will have to transfer your "sponsored" IRA funds from your current broker to your "self-directed" IRA custodian. However, once the LLC (beyond the self-directed IRA) is created, you will need a separate brokerage account for the LLC. At that point you can return to your current broker to establish a brokerage account for your LLC.




5.Q: How can I trust the Self-Directed IRA Custodian?

A: All of the custodians we use are registered trust companies. In order to register as a trust company they must pass stringent state requirements and have adequate reserves. If for any reason the custodian did go bankrupt, that should "NOT" affect your money at all. Your money is kept in a separate account for your benefit that is not subject to the creditors of the custodian. You are always in control (although not ownership) of your money. Lastly, your accounts are insured by an agency of the Federal Government for up to $100,000 (similar to, but not the same as, the FDIC).


6.Q: Can the LLC have more than one brokerage account?

A: Yes, the LLC can create as many brokerage and / or mutual fund accounts as you want. The accounts do not have to be with the same brokerage house.


7.Q: I have a number of different accounts with different brokers. Can I transfer all of them to the self-directed custodial account?

A: Yes. This is another benefit of the Self Directed IRA Retirement Fund Program. Consolidating all of your IRA accounts will make the management of your retirement assets so much easier. Instead of receiving 5 different account statements, you'll receive only one.


8.Q: Can I do this with my SEP or a 403(b) tax sheltered annuity?

A: If you are allowed to transfer the funds to an IRA then you can use this strategy. All you need to do is to rollover the funds to your self-directed IRA. One limitation is that, unlike your Tax Sheltered Annuity, you will not be able to borrow from the LLC.


9.Q: How about 401(K) money?

A: If you control the 401(K) account you can implement our Legal Structure Program of your self directed IRA Assets with those funds. However, if you are an employee of a corporation that controls the 401(K) then you probably will NOT be able to implement this strategy until you leave the company or retire.


10.Q. Are there any limits to my investments?

A: The Early Tax Free Liquidation of IRA Assets Program allow you to invest in any asset that an LLC can invest in. This can be a Big benefit for people who would like to use their IRA money to invest in LEAPS and OPTIONS. With the Early Tax Free Liquidation of IRA Assets, it is not the IRA investing in the money, rather it is the LLC. Remember, any and all investments with the LLC must be made in the name of the LLC and must use the LLC's taxpayer's identification number. You can NOT make the investments in your name and have the LLC reimburse you.


11.Q: Who receives the LLC when I die?

A: Anytime you establish a self-directed IRA Account, you must name a beneficiary for the account. Since the LLC is owned by your IRA, the LLC, it will be "passed" on to the beneficiary/(ies) of your IRA. Furthermore, since this is a transfer of your self-directed IRA, this transfer avoids Probate; there is no court, attorneys or lost years involved in settlement, (a WILL must go through Probate).


12.Q: How long does this take to get my new self-directed IRA started?

A: The length of time needed really depends upon how long it takes to transfer your sponsored IRA funds from the brokerage account to the self-directed IRA custodian. In many cases, the brokerage firms will delay the transfer of funds as they hate to "lose" the money. Once the funds are transferred to the custodian, the custodian's compliance department usually takes about 2 or 3 weeks to approve the investment in the LLC as administratively feasible.


13.Q: What are the ongoing fees?

A: One group of ongoing fees you will incur are annual fees from the custodian. These fees range from $50.00 a year to $500 a year, depending on the transaction activity (assets in and out of the self-directed IRA), plus fees for holding assets. In addition, you will have to file a tax return for the LLC. Depending upon the number of your transactions within the LLC, the Tax preparation fee might be as high as $500; however $500 should be on the high end of the cost for the return; the norm is around $300. There are annual State fees for maintaining the LLC as well. The State fees vary from $75 in Wyoming to $1,200 in New York. Finally, you will have to pay a fee to the Registered Agent within the State of Registration, typically $125 annually.


14.Q: Where can I get more information?

A: The concepts presented in this Web site have been written about in many different professional journals. In Paritcular: "The Journal of Taxation", "the Journal of New York CPA's" and "Trust and Estates" magazines. If your tax advisor says this cannot be done, you may want to refer him to one of these resources commonly used by tax attorneys and CPA's. Furthermore, the Department of Labor recently came out with a ruling specifically allowing an IRA to invest in a partnership of which the IRA's owner and family were already partners. While the ruling has no procedural value it is insightful into the thinking of the government.


15.Q: What are the annual costs and what are the annual requirements to maintain tax filings, registered agent and other filings?

A: They are $75 to the State of Wyoming; $125 to the Registered Agent (not us; approximately $300 for the review or preparation of the LLC Tax Return; and finally the Transaction and Holding Fees of the self directed IRA Custodian (which can vary from $200-$500, depending on the number of transactions and the number of assets being held by the custodian.


16.Q: Can this LLC operate in New Jersey for example instead of Wyoming?

A: Yes, but why would you want to? New Jersey is very favorable to 3rd Party Creditors, including the IRS. If necessary for licensing to do business within the State of New Jersy, we would file as a Wyoming foreign LLC registered to do business in the State of New Jersey. However, any law suit would be brought in the State of Wyoming, which state is very hostile to third party litigants.


17.Q: Why does the State of Wyoming require formal Due process for information release?

A: The State of Wyoming will simply not give information without a court order. This is because of the State of Formation. How do you test "due process" if not in court?




18.Q: You mentioned that my IRA would own "most" of the LLC but that ther would be another owner. Who would that be?

A: Another owner could be you, one of your Trusts, one of your other entities (not a Subchapter S Corp) or, going Off-Shore, an International Business Company (IBC) and a Foreign Grantor Trust (FGT). Most States require LLCs to have two or more owners, even if the LLC is only registered as a "Foreign" LLC within the State. In the case of a husband and wife, their two self-directed IRAs would be the owners (members). Wyoming allows an LLC to have only one owner (Member). In this way the LLC is vastly superior to a Corporation Sole.


19.Q: Regarding the Plaintiff maybe receiving a "charging order" allowing the LLC management to operate the LLC unfettered by the law suit's outcome, is this because of the state of formation, or the operating agreement? Has this been tested in court?

A: This is because of the State of Formation. It has been tested in court numerous times to the point it is considered standard procedure in Wyoming.


20.Q: You mention that the Special Provision LLC Operating Agreement provides for the return of the funds to the LLC by Retirement fund members and "Pure" Trust members. Has the "return of funds" been tested by the tax courts, or has the opinion letter been issued by the IRS? How long has this copyrighted system been used?

A: To our kowledge the return of funds has not been tested in Court because it is normally agreed to administratively by the IRS when the IRS is shown the provisions of the self-directed IRA that permit the re-investment of funds flowing into a retirement fund, without taxation to those funds. The re-investment provisions are a major characteristics of most retirement funds, including 401Ks. We have just applied to the IRS for a Private Ruling on our Program."

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#978 - 04/11/06 08:53 PM Re: Phoenix Spirit Self Roth IRA etc methods.
EclecticGuy Offline
New Member

Registered: 04/11/06
Posts: 7
Loc: All over.
Contact Info that is publicly listed on their site:

We have 2 Offices in the Southern California Area.

Phoenix Spirit Enterprises, Inc
432 So. Curson Ave. Ste. 1 B
Los Angeles CA., 90036

Tel. 866-494-4619
Fax. 323-933-6443

Phoenix Spirit Enterprises, Inc
6475 E. PCH., Ste.383
Long Beach, CA., 90803

Tel. 562-494-4619 2nd line: 562-494-1003
Fax. 562-986-6894

Our Email: info@phoenixspiritent.com

Our Toll Free Number:
866-494-4619

Products- Manual and Video:

"Achieving Dramatic Savings in Capital Gains Taxes"
Manual No. 1
To more fully understand how our services can increase your personal cash flow, we offer a Manual Describing: 1) Why we establish certain legal and financial structures for you, personally; and 2) How these legal and financial structures can substantially reduce your business and personal Capital Gains Taxes, your business income taxes, your personal income taxes, your real estate taxes, and applicable estate taxes, leaving you with more disposable money to spend on YOURSELF and YOUR family.
***MY NOTE: This was something like 60-70$ on their old site, if my memory serves me well.***

Creative Tax Strategies – VHS Video Tape
This is a 25 minute in-depth instrutional video demonstrating the various applications appropriate to our legal structures. While the discussion is thorough as to the examples being used, it is geared to an audience of layman. We therefore do not use the arcane terminology of the tax professional, making this video tape usable to the general public.
***MY NOTE: This was something like 20-30$ on their old site, if my memory serves me well.***

Testimonials (no idea if they are fake or not):

"What People are saying about OUR Services"
My name is Dr.Stanley S.,

Last year I had Phoenix Spirit Enterprises set up my self-directed IRA, Trust and corresponding LLC. I had purchased the office building in which I had my practice.
I sold my practice to allow me to retire but the office building was too much for the purchasing group. The title to the building was in my Sub Chapter S Corporation; My former accountant estimated my Capital Gain liability at $224,366!?!!. I was fortunate enough to find Phoenix Spirit through some friends. Phoenix Spirit established my self directed IRA, Trust, and formed my LLC. They worked with me to establish the Tax Basis of the building, when my former accountant could not figure it out.

When I first went to my former accountant, they told me what I was doing could not be done - it was illegal. But they could NOT cite the Tax Code references that made it illegal. I decided to proceed anyway. In my interactions with the Trust Custodian (the seventh largest bank in the United States) and the Corporate Division of the Secretary of State of Wyoming, I have been continuously assured by these third parties that the program is legal and proper.

I recommend Phoenix Spirit to whose who wish to legitimately avoid Capital Gains Tax. -- Dr. Stanley S.
(His email Address given up on request. Write to web master. "below"-- "Contact us")

My name is Dr.William S.

I have been working with Richard, CEO of Phoenix Spirit over the last 6 months or so.
The best move I ever made was by having him create my own Self-directed IRA. Richard Edgar is very professional and is always there for me day and night and is helping me resolve these issues in a very Professional and responsible manner.

His character is beyond reproach and his knowledge of IRS law is second to none.
I proudly recommend Richard as a CPA to anyone that wants the best of the best on their team. Yours Truly, Dr William S. (His email Address given up on request.- Write to web master. "below" -- "Contact us"

My name is Dan A.

I am a senior Airline Pilot, flying 737's on the United States to Europe routes. Because I am regularly in Europe, I am exposed to trading in financial instruments that are not available in the United States. I trade regularly in these instruments while in Europe. I used Phoenix Spirit Enterprises to create a Retirement Program and establish a Limited Liability Company, which I now use to make my trades. Through the use of these structures, I was able to eliminate the mandatory 30% IRS witholding on foreign generated income through a little known provision of the DOL Regulations governing Retirement Programs.

These strategies have paid for themselves within four (4) months and I am thrilled with the results!!

I am anxious to refer other flight crew members to Phoenix Spirit so that they too can enjoy these Benefits! (His email Address given up on request. Write to web master. "below"-- "Contact us")

My name is James J.

I am a Trial Attorney in California. Because I am not an expert in tax matters and legal structures, and because I am overburdened with Trial work, I had Phoenix Spirit Enterprises create a Trust with a corresponding Limited Liability Company to respectively, hold and operate several real estate projects I and my brother are developing. I have found the resulting disposable cash available achieved by the Phoenix Spirit Enterprises program to be vastly greater than the disposable cash
generated by the standard legal and financial structures that we had been using. I have been delighted to refer the Phoenix Spirit Enterprises program to several of my clients. (His email Address given up on request. Write to web master. "below"-- "Contact us")

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#979 - 04/11/06 09:33 PM Re: Phoenix Spirit Self Roth IRA etc methods.
EclecticGuy Offline
New Member

Registered: 04/11/06
Posts: 7
Loc: All over.
Found an archive of their old site, which takes a while to load but allows you to view most if not all of their old site from March 2005:

http://web.archive.org/web/20050312231226/http://www.phoenixspiritent.com/

Quote from the old "how it works" page which does not work on the new/current version of the site:

"Certain retirement programs accumulate investment income without paying tax on that investment income. These programs include Roth IRAs, 401(k)s,401(b)s and SEP IRAs, among others.

Step One
We establish a Self-Directed (not a sponsored) retirement program for you. We normally use a Self-Directed IRA.

You are the beneficiary of your self-directed Roth IRA. You determine what investments in which you wish the self-directed ROTH IRA to invest.

You decide that you will have your self-directed Roth IRA invest in a Limited Liability Company (LLC)that we have established for you and for which you are the Managing Member.

Step Two
The Limited Liability Company (LLC). is now owned by the self-directed ROTH IRA. You are the Managing Member of the LLC. As such you operate the business of the LLC.

You as an individual entity, legally are separate from both the Limited Liability Company and the self-directed ROTH IRA. The owner of the LLC is the Self-directed ROTH IRA, a retirement Program.

IMPLICATIONS

Legal Liability
Should the LLC be sued, the owner of the LLC, the retirement program, is only sued if separately named in the lawsuit. The Department of Labor has made it very difficult to sue retirement programs. Furthermore as the Managing Member, you are only an employee of the LLC; it is very difficult in court to make an employee of a corporation (and the LLC is a corporation) personally liable for the actions of a corporation.

Tax Liability
While the LLC files an informational tax return, the LLC pays no tax. The tax is paid by the owner of the LLC. The owner of your LLC is a Retirement program. Certain retirement programs pay no income tax on the investment returns of their investments. Therefore your retirement program pays no income tax on the investment return (the "profits") of the LLC.

Your personal tax liability is limited to the "salary" paid to you as the managing member of the LLC by the LLC. You, as the Managing Member of the LLC, determine not only the amount of the "salary" but the timing of the payment.

Cash Impact
You have dramatically and legally lowered both your business and personal capital gains tax liabilities and also dramatically and legally lowered your business and personal income tax liabilities. These extraordinary tax savings are placed directly into your self-directed retirement program. Your cash position has been significantly increased."

Quote from the old "Non-Taxable Entities" page which does not work on the new/current site:

"Non-Taxable Entities are:

A ) Self Directed Retirement Accounts

1) Self Directed Traditional IRA

2) Self Directed Roth IRA

3) Self Directed SEP IRA

4) Self Directed 401k

5) Self Directed 403B

6) Money Purchase Plans

7) Pension Plans

B ) Massachusetts Trusts

C ) Offshore Entities "

Quote from the old page link to "Self Directed Roth IRA" (as it is the most I am interested in here so far)

"Self Directed Roth IRA

Wage-earning individuals who want to save for retirement are eligible for Roth IRA contributions if they have adjusted gross income (AGI) below $110,000 if single and $160,000 for joint filers. If you are interested in converting a Traditional IRA to a Roth Conversion IRA, you must have AGI below $100,000 and be a single or married filing joint tax payer.

Annual IRA contributions are limited to a total of $3,000, or 100% of compensation, whichever is less. Individuals age 50 and older can make "catch-up" contributions of up to $500 in addition to Regular Contributions.

Non-employed spouses who file a joint tax return may also contribute up to $3,000 per year. Contributions may be made even after age 70½. Roth IRAs can be used in conjunction with any other retirement plan.

Distributions at retirement are TAX-FREE provided certain conditions are met.

Our Self-Directed IRAs provide you the FREEDOM-OF-SELF -DETERMINATION in selecting investments for your account. These include, but are not limited to, Investment Real Estate, Limited Partnerships, LLCs, Private Stock as well as the full spectrum of marketable securities."

From the old "Request Free Information Page":

"Request free information on ONE legal technique to free up your IRA money, without penalty; invest in yourself and your business by financing your dreams. Our complete IRA manual provides information bout what can and cannot legally do with your Traditional and Roth IRA and 401Ks money; and, moreover, explains how you can free up IRA money, without IRS penalty, to do whatever YOU want to do, NOW! When we researched in-depth exactly into what investment vehicles an IRA could (and could not) invest IRA money, we found a tremendous amount of misleading, incomplete and biased information in the IRA market place - coming primarily from the securities firms, insurance companies and banks who provide the Traditional and Roth IRA and administer the 401Ks.

The information gathered into this IRA manual has taken from many different professional, business and money journals. We have intensively investigated enabling IRS, ERISA and Department of Labor Codes and Regulations, which we reference. Our manual is a "true" and complete IRA information source, in one place, about the IRA money vehicles; and we demonstrate how the IRA law can be used in non-traditional ways to greatly benefit YOUR personal business and to enable YOUR dreams.

To file your request for FREE information on “Exemptions to IRA Prohibited Transaction Rules”. Fill out the requested information below and the information will be mailed to the address you have specified."

Also, one the same page, once the images on the right load you can see that they were selling the Manual for 59.95 and the VHS Tape for 29.95, which they still list on their new site but they don't seem to have an online store for nor do they seem to list the prices.

If anyone cares, since the whois info has an email for jason@newerasolution.com, the following info is for newerasolution.com:

Registrant:
newerasolution

1610 s. lacienega blvd # 105
los angeles, California 90035
United States

Registered through: PSADOMAIN
Domain Name: NEWERASOLUTION.COM
Created on: 24-Aug-01
Expires on: 24-Aug-06
Last Updated on: 08-May-05

Administrative Contact:
goly, niko niko69ca@yahoo.com
newerasolution
1610 s. lacienega blvd # 105
los angeles, California 90035
United States
310 271-8188 Fax -- 310 271-6082

Technical Contact:
Registrar, Domain domain-registrar@register.com
Register.Com
575 8th Avenue - 11th Floor
New York, New York 10018
United States
902-749-2701 Fax -- 902-749-5429

Domain servers in listed order:
DNS41.REGISTER.COM
DNS42.REGISTER.COM

From NewEraSolution.com:
"Full Service Center" , "Hardware and Software" , "Custom Built Servers", "Web

Hosting and Design"
Phone: 310-777-8887
1610 s. lacienega blvd # 157
los angeles, California 90035
United States
sales@newerasolution.com

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#980 - 04/11/06 11:42 PM Re: Phoenix Spirit Self Roth IRA etc methods.
Jay Adkisson Offline
Expert
*****

Registered: 06/05/04
Posts: 1108
Loc: Newport Beach, Orange County, ...
One can have a self-directed IRA in the sense that if you can find an IRA custodian who is amenable to your advice, you can have the IRA custodian make investments into non-traditional investments (for IRAs) such as real estate and closely-held companies.

HOWEVER, if you have the IRA self-directed into your own LLC that you yourself control, then you are running a risk that the IRS will claim that you have had a "constructive receipt" of your money, i.e., it is just as if you had withdrawn it from your account. In other words, if you think you can put it into an IRA and then regain control of it again through some artifice, better think again as that will probably not work.

As for the rest of their schlock, life is too short to respond to all of it (i.e., that Wyoming LLCs have some special advantages, yada, yada, yada).

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#981 - 04/20/06 05:12 AM Re: Phoenix Spirit Self Roth IRA etc methods.
EclecticGuy Offline
New Member

Registered: 04/11/06
Posts: 7
Loc: All over.
Just wondering if any of you professionals that are reading this would actually contact PhoenixSpirit and thoroughly scrutinize their LLC owned by Self Directed Roth IRA tax savings strategy. Who knows? ... Maybe it is actually a very great and very legal strategy. All I've seen is one theory of why it wouldn't work, which has not actually been proven. I mean no disrespect. I'm looking for somebody who cares enough to really find the truth and prove it.

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#982 - 04/20/06 05:18 AM Re: Phoenix Spirit Self Roth IRA etc methods.
Jay Adkisson Offline
Expert
*****

Registered: 06/05/04
Posts: 1108
Loc: Newport Beach, Orange County, ...
When you take the money into an LLC that you control as the managing member, then it is constructive receipt of the money as if you had just taken the money out of the account.

In other words, it doesn't work. Don't believe me? Go to the IRS and ask them for a private letter ruling. Or ask them what law firm has given them a tax opinion that validates the benefits of their program, and post a copy of that opinion.

This is all in addition to the fact that the website is being used to run a Pure Trust (UBTO) scam.

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