Opening an account
To start an account, you must have a copy of a valid government-issued I.D., W-9 Form found here & $25. To start the account application process, click on this link.
Fee Schedule
*Does not include a one-time set-up fee of $25 or $75 transaction fee for purchasing or selling a note within an IRA. **Annual account fees may differ for Individual K, HSA, EBP, and taxable accounts.
For a complete list of Mainstar Trust fees, click here.
Opening An Account – There are a variety of account options to accommodate investment in Private Lending assets:
Rollover from a 401(k) or Qualified Plan – funds in a retirement plan with a former employer or current employer if the plan allows in-service withdrawals, is rolled over tax-free to Traditional or Roth IRAs if from ‘like’ accounts.
Traditional IRA – income earned in the IRA is sheltered from income tax until distributions occur. At that time, the income is taxed at ordinary income rates.
Roth IRA – any income and capital appreciation earned is free of federal tax, provided the money has been in the Roth IRA for a minimum of 5 years, and you are at least 59 ½.
Small Business Retirement Plans – there are various options for business owners to consider, including SEP and SIMPLE IRAs and Individual 401(k) plans.
Select the Account Option appropriate for you and click on the link to download a new account kit: https://mainstartrust.com/account-options. The kit includes an application, a Transfer/Rollover form (used to transfer from an existing IRA or rollover from a defined contribution or benefit plan), and a Purchase Authorization form (used to purchase the note).
Who To Loan Money To? When investing with a Self-Directed IRA, it is important to know IRS regulations on prohibited transactions and disqualified persons. An individual cannot use his/her IRA to loan to or engage in any transaction with a disqualified person, or it could lose its tax-advantaged status. Examples of disqualified persons include:
You (Accountholder)
Your spouse
Lineal ascendants and descendants (children, grandchildren, and any of their spouses or parents)
Any organization where a disqualified person owns over 50% of a trust, LLC, corporation, etc.)
Any organization listed above where the owner of the IRA is an officer, director, a 10% or more shareholder, or a highly compensated employee
Investment sponsors or fiduciaries of the IRA
There are a variety of additional IRS restrictions, including:
IRA investment in a prohibited asset such as jewelry, art, collectibles, and others
Taking personal possession or using property held within an IRA is prohibited.
All IRA asset-related expenses must be paid from funds within the IRA
Accountholders may not pledge their IRAs as collateral for any loan outside of the IRA
Accountholders may not lend to or borrow from their IRAs. Nor may any prohibited individual or entity make a loan to or borrow from your IRA.
IRS Code 4975 should be referenced for questions regarding IRS IRA restrictions and prohibited transactions. Investors are encouraged to do adequate research or contact a broker/financial advisor, attorney, or CPA to determine if private notes are an appropriate investment for them.
Using Mainstar Trust to Purchase on Paperstac
When investing on Paperstac using a Mainstar Trust account, you will have to complete a form called a Self-Directed Investment Direction Form. To learn about all of the details of what will be needed to invest, please view this page.
Learning With Mainstar Trust
To get to know more about Mainstar Trust, you can learn more in this video below.