Banks do not hold assets. Banks are NOT usually the directors of tax advantage accounts. The banks typically hold the *funds* prior to allocation into the tax advantaged account. They have nothing to with this.
Tax advantaged accounts belong to a custodian on behalf of a person - this part you have correct. What you don’t understand is that the custodian can be an entity controlled by the same person who is the contributor to the account. There is no law against this. This entity can take on a myriad of forms, but the easiest is to just set up a trust fund.
The fund has a checking account. The bank controls the checking account. The fund controls the allocation of, management of, and record keeping of the fund. This means that if the fund was investing in barrels of oil or artwork, it would be responsible for the storage, security, and maintenance of those barrels and artwork until it divests from them. There is no difference between an entity storing artwork in some rando warehouse or their garage vs storing corn in cold storage. All that matters is that the entity remains in control over those assets.
If the contributor and the owner of the entity are the same person, it’s irrelevant. They are two distinct “things” in the eyes of the law. In reality, however, you are effectively controlling your keys.
You need to spend some time reading up on how this works, amigo.
nicodemus
npub1qq…pryz3
2024-10-14 17:24:10
in reply to nevent1q…9q9x
Author Public Key
npub1qqqqypnst2u7wdlmexad9gjamstlg7c4ck2w4cadv4j5xd5e8vvsupryz3Published at
2024-10-14 17:24:10Event JSON
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"content": "Banks do not hold assets. Banks are NOT usually the directors of tax advantage accounts. The banks typically hold the *funds* prior to allocation into the tax advantaged account. They have nothing to with this. \n\nTax advantaged accounts belong to a custodian on behalf of a person - this part you have correct. What you don’t understand is that the custodian can be an entity controlled by the same person who is the contributor to the account. There is no law against this. This entity can take on a myriad of forms, but the easiest is to just set up a trust fund. \n\nThe fund has a checking account. The bank controls the checking account. The fund controls the allocation of, management of, and record keeping of the fund. This means that if the fund was investing in barrels of oil or artwork, it would be responsible for the storage, security, and maintenance of those barrels and artwork until it divests from them. There is no difference between an entity storing artwork in some rando warehouse or their garage vs storing corn in cold storage. All that matters is that the entity remains in control over those assets. \n\nIf the contributor and the owner of the entity are the same person, it’s irrelevant. They are two distinct “things” in the eyes of the law. In reality, however, you are effectively controlling your keys. \n\nYou need to spend some time reading up on how this works, amigo.",
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