[Update: This post is now irrelevant because Prosper started offering an IRA in 2012. Prior to this you had to jump through the hoops described below. You can read my post announcing the Prosper IRA here and you can open an IRA with Prosper here.]
No one likes paying taxes. But for Prosper investors there has been no alternative but to pay taxes on the interest earned because there is no IRA option available….or so I thought.
I received an email from a fellow Prosper investor over the long weekend that introduced me to the concept of a Prosper IRA. This is not one that is officially sanctioned by Prosper but it does appear to work. Now, it is not cheap and it certainly isn’t easy, but it seems to be completely legal. If you want to make a sizable Prosper investment then you could save a great deal of money in taxes by setting it up this way.
One Prosper investor has gone ahead and done this. His name is Tym and he is happy to share his findings with everyone. Here are his instructions: [Read more…]