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A Quick Reference Guide to Self-Directed IRAs andIndividual 401(k) PlansMaking the most of your Self-Directed IRA and Individual 401(k) Plan through Alternative Investments.82

About Exeter Trust Company Exeter Trust Company specializes in collaborating with clients and their advisors who want to invest their retirement account funds in non-traditional investments, often referred to as alternative investments. Exeter Trust has signicant expertise and decades of experience in the administration and custody of real estate related assets, private placements and private, closely held entities.More than a third-party administrator or processor, Exeter Trust is the Directed Custodian (trust company) that can support clients and their advisors with transactions from basic to complex. Exeter Trust – Directed CustodianExeter Trust provides directed custody services for non-traditional investments held in Self-Directed IRAs, Individual 401(k) Plans, and custody accounts. Exeter Trust serves as a “passive” or “directed” custodian. Clients and their advisors are solely responsible for evaluating and choosing the investments and authorizing and directing Exeter Trust to process the purchase, sale, or exchange of the investments. Exeter Trust does not provide any legal, tax, investment or nancial advice.3

© Copyright 2019– 2024 by Exeter Trust Company. All Rights Reserved.Exeter Trust – CorporateExeter Trust is a Wyoming corporation with its corporate ofce located at 205 Storey Boulevard, Suite 200, Cheyenne, WY 82009. Exeter Trust is licensed, regulated, and audited by the Wyoming Division of Banking. Exeter Trust is a subsidiary of The Exeter Group, LLC, a California LLC, with its national corporate headquarters ofce located at 404 Camino del Rio South, Suite 600, San Diego, CA 92108. The Exeter Group, LLC is celebrating its 20th anniversary in 2024.4Alineh MouradianBusiness Development OfficerExeter Trust Company205 Storey Boulevard, Suite 200Cheyenne, WY 82009(307) 222-8750AMouradian@exeterco.comexeterco.com82Our clients have consistently awarded us a high referral score.

What is a Self-Directed IRA or 401(k) Plan? IRAs and Individual 401(k) Plans are all self-directed accounts because clients and their advisors choose the custodian they wish to work with.However, clients and their advisors are often frustrated by the limited asset classes administered or allowed by most custodians. They want more investment options and control over the retirement account.What is a Self-Directed Custodian?Self-directed custodians (“Directed Custodians”) provide clients and their advisors with more control and exibility in choosing the investments. Directed Custodians allow clients (and, if so authorized by clients, their advisors) to select and invest in non-traditional, non-publicly traded investments, often referred to as alternative investments, that can potentially provide greater diversication and higher returns.5

Get Started – Take Back Control Choose a Self-Directed IRA or 401(k) PlanSelect the IRA or 401(k) Plan best suited for the client’s goals and objectives (or that the client will transfer to Exeter Trust Company). Exeter Trust administers the following Self-Directed IRAs and 401(k) Plans: • Traditional IRA• Traditional IRA for Kids • Rollover IRA • Inherited IRA • Roth IRA• Roth IRA for Kids• Roth Conversion IRA • SEP-IRA • SIMPLE IRA • Individual 401(k) Plans or Solo Ks• Custody Accounts (non-retirement accounts)6

Choose a Non-Traditional InvestmentChoose the non-traditional investments the client wishes to purchase inside their retirement account. Types of non-traditional investments or alternative investments administered by Exeter Trust Company, include, but are not limited to: • Real Estate Investment Trusts (REITs) • Promissory notes secured by deeds of trust • Promissory notes secured by mortgages • Tax lien certicates • Real estate• Fractional ownership in real estate such as tenants-in- common investment properties (“TICs”) or Delaware Statutory Trusts (“DSTs”)• Closely held companies • Private limited partnerships (“LPs”)• Private limited liability companies (“LLCs”) • Master limited partnerships (“MLPs”) • “C” corporations • Foreign currencies • Hedge funds and venture capital funds• Mineral rights, air rights, water rights and oil & gas investments 7

Each investment or asset is unique and is subject to Exeter Trust’s assessment of administrative feasibility.Non-Permissible Investments The US Tax Code prohibits certain assets from retirement accounts, including sub-chapter “S” corporations, life insurance policies and collectibles.Choosing a Directed CustodianSelect a Directed Custodian that is best suited to administer and custody the retirement account based upon their expertise and experience in processing, holding and administering the non-traditional investments selected by the client.Funding a Self-Directed IRA or 401(k) PlanClients can fund their account by making a contribution to the IRA or 401(k) Plan or by transferring an existing account to Exeter Trust Company. 8

Transfer a Self-Directed IRA or 401(k) Plan Transfer an existing account from the current custodian to Exeter Trust. There are three ways to transfer accounts and the assets held in the accounts from the current custodian to Exeter Trust. IRA-to-IRA TransferThe most common method used in transferring IRAs and assets held in the IRAs is an IRA-to-IRA transfer. Assets held by the current custodian are transferred directly to Exeter Trust and not to the client.IRA-to-IRA transfers are non-reportable transfers. There are no limits on the number of IRA-to-IRA transfers that can be initiated by the client.IRA RolloverA less common method used in transferring IRAs and the assets held in the IRAs is an IRA Rollover. Assets held by the current custodian are distributed to the client. The client must rollover the assets to Exeter Trust within sixty calendar days to avoid a taxable distribution.IRA Rollovers are reported by the current custodian on IRS Form 1099-R. Exeter Trust will report IRA Rollovers received within the required sixty calendar day rollover period on IRS Form 5498. IRA Rollovers are limited to one rollover in any twelve-month period. 9

IRA Rollovers are used when an IRA Transfer will take too long.Direct Rollover Transferring assets from a pension, 401(k) or other qualied retirement plan can be completed through a direct rollover (trustee to custodian) or a rollover (trustee to client to custodian). The most common method is the direct rollover. Self-Directed AccountsSelf-Directed IRAs and Individual 401(k) Plans are client directed retirement accounts. Clients are solely responsible for the evaluation and selection of investments purchased in the retirement accounts. Clients are also free to delegate such decisions to their nancial advisors.Exeter Trust Company does NOT provide, offer, sell, recommend, or endorse any investment products, services, sponsors, or nancial advisors, and it does NOT provide any legal, tax, investment, or nancial advice.10

Investments Not Guaranteed or Insured Investments evaluated, selected and purchased by clients in Self-Directed IRAs and 401(k) Plans are NOT guaranteed or insured by the FDIC, by any government or regulatory agency, or by Exeter Trust. Clients assume all risks related to investments selected and purchased in Self-Directed IRAs, Individual 401(k) Plans, and custody accounts.Investment RisksInvestments may result in loss of principal. It is crucial that clients and their advisors thoroughly research and understand the risks associated with each investment before making an investment decision. Clients must consult with their own legal, tax, investment, and nancial advisors before proceeding with any transaction. Exeter Trust assumes NO responsibility or liability for any risks or losses resulting from investments selected and purchased in Self-Directed IRAs, Individual 401(k) Plans and custody accounts.Prohibited Transactions (Self-Dealing) Self-dealing transactions are prohibited by Section 4975 of the US Tax Code and can result in signicant penalties. Self-dealing transactions include, but are not limited to, borrowing money from a retirement account for personal use, pledging 10

a retirement account as collateral for personal use, buying an asset with retirement account funds for personal use, performing services for your own retirement account, and related party transactions. Client’s legal, tax, investment and nancial advisors must review all transactions prior to execution to avoid prohibited transactions. Filing IRS Form 990-T for UBTI/UDFIInvestments held inside IRAs or 401(k) Plans must be passive in nature. Non-passive (i.e., active investments) may result in Unrelated Business Taxable Income (UBTI). Leveraged investments (i.e., investments purchased with nancing) may result in Unrelated Debt Finance Income (UDFI).Client’s legal, tax, investment and nancial advisors must review all investments before execution to determine if the transaction will result in UBTI or UDFI. UBTI or UDFI will require the retirement account to le IRS Form 990-T and potentially pay taxes. 11

Legal Vesting (Ownership) of AssetsAssets acquired and held inside IRAs and 401(k) Plans must have the proper legal vesting (ownership) to avoid future legal problems. The proper legal vesting for Exeter Trust Company is Exeter Trust Company, a Wyoming corporation, as Custodian for IRA No. [insert account number], FBO [insert account holder’s name]. Asset Valuation RequirementsNon-traditional investments must be valued annually to comply with IRS regulations and reporting requirements. Asset sponsors must provide Exeter Trust with an annual written estimate of the current fair market value of each asset. Failure to properly value non-traditional investments can result in signicant penalties and potential disqualication of the entire retirement account. 12

11The Exeter Group of CompaniesExeter 1031 Exchange Services, LLC1031 Exchange Services Group Qualied Intermediary for 1031 Exchanges Exeter1031.com Exeter Asset Services Corporation 1031 Exchange Services Group Exchange Accommodation Titleholder for Parking ArrangementsExeterAssetServices.com Exeter Trust Company, Cheyenne, Wyoming1031 Exchange Services Group Trustee for Qualied Trust Accounts Retirement Services GroupCustodian for Self-Directed IRAsCustody Services GroupCustodian for Non-Retirement Account AssetsEscrow Agent for Specialized Holding EscrowsTrust Services GroupTrustee for Title Holding Trusts (Land Trusts)ExeterTrustCompany.net

Exeter Trust Company is a member of The Exeter Group of CompaniesA Better Self-Directed IRA and 401(K) Plan ExperienceANNIVERSARYTHE EXETER GRO UP LLCTHIS GUIDE IS PROVIDED FOR EDUCATIONAL PURPOSES ONLY AND SHOULD NOT BE CONSTRUED AS PROVIDING LEGAL, TAX, OR INVESTMENT ADVICE