Preferred Trust Company Review

Preferred Trust Company is a Nevada-regulated retail trust company that serves as custodian and administrator for self-directed individual retirement accounts. Its platform is designed for investors who want retirement-account exposure to assets that most conventional brokerages do not custody, including real estate, private placements, trust deeds, precious metals, digital currency, and natural-resource investments.

Preferred Trust is not an investment adviser. It processes eligible directions, maintains account records, holds or documents assets, receives investment income and completes applicable tax reporting. The account owner remains responsible for selecting investments, negotiating terms, evaluating risk and complying with self-directed IRA rules.

Founded in 2007 and headquartered in Las Vegas, Preferred Trust Company is a retail trust company licensed, regulated, and examined by the Nevada Financial Institutions Division. It administers Traditional, Roth, SEP, and SIMPLE IRAs, as well as eligible inherited IRAs, and can hold alternative investments such as real estate, trust deeds, private placements, precious metals, and digital currency. 

Under its published schedule, a metals-only IRA has a $300 annual administration fee plus depository storage, while standard annual fees begin at $300 and rise according to total account value. 

Accounts must generally maintain at least $500 in cash, and real-estate investments are subject to an additional reserve policy. Preferred Trust does not provide investment advice, so it is best suited to investors who understand alternative assets and value direct service from a regulated custodian.

Is Preferred Trust Company Worth Considering?

Preferred Trust Company is worth considering for investors seeking a regulated self-directed IRA custodian with experience in real estate, physical precious metals, private investments, and cold-storage cryptocurrency. Its public fee disclosures, long operating history, and generally positive service reviews are meaningful strengths.

The company is less attractive for investors seeking the lowest-cost way to hold conventional securities or those who make frequent alternative-asset transactions. Standard account administration charges increase with account value, while asset-specific, transaction and exit charges can materially increase total cost.

Preferred Trust is best evaluated as an administrative partner rather than an investment expert. The company can help execute and document an eligible transaction, but its acceptance of an asset does not mean the asset is safe, appropriately priced, or suitable for the investor.

What Is Preferred Trust Company?

Preferred Trust Company, LLC was founded in 2007 and is headquartered in Las Vegas. The company states that it is licensed, regulated, and examined annually by the Nevada Financial Institutions Division. Unlike firms that act only as third-party administrators, Preferred Trust performs both custodial and administrative functions.

Its work can include establishing an IRA, receiving qualified funds, reviewing transaction documents for administrative requirements, executing account-owner instructions, processing expenses and income, maintaining records, providing statements, and reporting account information to the IRS.

The custodian does not normally investigate whether an investment sponsor is financially sound, determine whether the asking price is fair or forecast returns. Investors should use independent legal, tax, and financial professionals when the proposed structure is complex.

What Is a Preferred Trust Self-Directed IRA?

A self-directed IRA is generally a Traditional, Roth, SEP or SIMPLE IRA administered by a custodian that permits a broader investment menu. It is not a separate tax category. Contribution, distribution and required-minimum-distribution rules still follow the underlying account type.

The IRA is the legal owner of its investments. Contracts, deeds, notes, subscription documents and depository records should reflect the retirement account’s ownership. Investment income must return to the IRA, and asset expenses should normally be paid with IRA funds.

Self-direction expands investment choice but also increases risk. Private placements, loans and real estate may lack transparent pricing or a ready secondary market. Physical metals have dealer spreads and storage costs, while cryptocurrency can be highly volatile and dependent on specialized custody infrastructure.

Preferred Trust Company Account Types

Traditional IRA

A Traditional IRA provides tax-deferred growth. Contributions may be deductible when eligibility rules are satisfied, while taxable withdrawals are generally treated as ordinary income. Required minimum distributions apply under current federal law.

Roth IRA

A Roth IRA is funded with after-tax money. Qualified distributions can be tax-free when age, holding-period and other requirements are met. Original Roth IRA owners are not generally required to take lifetime minimum distributions.

SEP IRA

A SEP IRA is intended primarily for self-employed individuals and business owners. Employers fund the account, and contribution limits can be higher than ordinary IRA limits. Employer contributions must follow applicable coverage and allocation rules.

SIMPLE IRA

A SIMPLE IRA allows employees of qualifying small businesses to make salary-reduction contributions. The employer generally provides matching or nonelective contributions. Special distribution rules apply during the initial two-year participation period.

Inherited IRA

Preferred Trust can administer eligible inherited accounts. Beneficiary distribution rules vary according to the original owner’s date of death, age and relationship to the beneficiary. Illiquid alternative assets can make distribution planning more difficult.

What Investments Can Preferred Trust Hold?

Preferred Trust supports a range of alternative assets, subject to the company’s acceptance policies and document requirements. Investors should confirm acceptance before entering a binding agreement.

Directly Owned Real Estate

An IRA may purchase accepted residential, commercial, agricultural or undeveloped property. The account—not the individual—must own the property. Rent and sale proceeds return to the IRA, while taxes, insurance, repairs, utilities and other expenses are paid from IRA funds.

Preferred Trust requires each IRA-owned property to maintain a cash balance equal to 5% of the investment value for property expenses. This is separate from the general $500 cash policy. Investors should consider how the reserve will be funded when the account is dominated by illiquid real estate.

The owner, spouse and other disqualified persons generally cannot use the property personally. Paying expenses personally or providing substantial uncompensated services can create compliance problems.

Trust Deeds and Promissory Notes

An IRA may fund accepted mortgage, trust-deed or private-note investments. The investor is responsible for evaluating the borrower, collateral, lien priority, documentation, interest rate, repayment schedule and default remedies.

Loans to the IRA owner or another disqualified person are generally prohibited. Preferred Trust’s processing of loan documents is administrative and does not establish that the collateral is sufficient or the borrower is creditworthy.

Private Equity and Private Placements

Eligible interests in privately held companies, startups, partnerships and limited liability companies may be held. Private investments can produce significant gains, but they can also fail completely and often have limited financial disclosure, transfer restrictions and uncertain valuations.

Investors should evaluate management, capitalization, financial statements, conflicts, fees, capital-call provisions and exit rights. The issuer’s presence in a custodian’s network is not an endorsement.

IRA-Owned LLCs

A self-directed IRA can potentially own a properly structured limited liability company, sometimes called a checkbook IRA LLC. This arrangement can give the LLC manager faster control over investment payments, but it also increases compliance and recordkeeping responsibility.

Every transaction must still comply with IRA rules. Checkbook authority does not permit personal use, related-party transactions or the commingling of retirement and personal funds. Independent legal advice is particularly important when creating the entity.

Physical Precious Metals

Preferred Trust supports qualifying gold, silver, platinum and palladium coins and bullion. Metals must satisfy federal standards and remain in an approved third-party depository while owned by the IRA.

Digital Currency

Preferred Trust has offered IRA cryptocurrency custody since 2017 and uses cold-storage wallet devices. The company publishes a list of supported assets that has included Bitcoin, Ethereum, Litecoin, Solana and other cryptocurrencies. Availability can change.

The platform has used Coinbase for trade execution while Preferred Trust handles the retirement account and cold-storage process. Cryptocurrency prices are volatile, and account owners should understand transaction charges, blockchain fees, storage arrangements and the time required to move assets between trading and cold storage.

Natural Resources and Other Alternative Assets

Depending on structure and acceptance, an IRA may hold interests involving oil, gas, minerals and other private opportunities. These investments can carry operational, commodity-price, environmental, regulatory and sponsor risk.

How a Preferred Trust Account Works

The investor first chooses an account type and submits an application. The account can then receive funds through an eligible contribution, trustee-to-trustee transfer, direct rollover or another permitted retirement-account transaction.

After identifying an investment, the owner performs due diligence and submits Preferred Trust’s investment authorization form with supporting documents. The custodian reviews the transaction for administrative and custody requirements. If accepted, it sends IRA funds and records the asset under the account’s title.

Income returns to the IRA, and the account pays authorized investment expenses. The owner supplies fair-market values when required and keeps sufficient cash available for fees and asset costs. When exiting, the account may sell the asset, transfer it to another custodian or distribute it in kind, subject to tax rules and processing charges.

Preferred Trust Company Fees

Preferred Trust uses separate fee structures for standard mixed-asset accounts, metals-only accounts and certain investment categories. The latest schedule should be reviewed with the account application because pricing can change with written notice.

Standard Annual IRA Administration Fees

For a standard self-directed IRA, the annual administration charge is based on the combined value of account cash and assets.

Under the published schedule, an account valued at up to $50,000 pays $300 annually. The fee increases to $400 for accounts valued from $50,001 to $100,000, $500 from $100,001 to $200,000, $600 from $200,001 to $300,000, $700 from $300,001 to $400,000, $800 from $400,001 to $500,000 and $900 from $500,001 to $600,000. Accounts valued at $600,001 or more pay $1,000 per year.

The annual fee includes account access, statements, tax reporting, contribution and distribution processing, and certain valuation-related services. Asset-specific and transaction fees can be additional.

Precious-Metals IRA Fees

An account holding only precious metals is charged a flat $300 annual administration fee under the current public schedule. Storage is billed separately based on the chosen depository and storage type.

The published annual administration fee for a metals-only IRA is $300. Preferred Trust also lists a $50 fee for each precious-metals purchase, a $200 fee for each sale and a $200 fee for an in-kind metals distribution. Depository storage costs depend on the selected facility and whether the investor chooses segregated or nonsegregated storage, while shipping and handling charges also vary.

If an investor adds a different asset type to a metals-only IRA, Preferred Trust may convert the account to the standard value-based schedule and assess the difference in annual fees.

Real-Estate Fees

The published schedule lists a $300 real-estate transaction fee for a purchase or sale and a $300 annual asset-administration fee for each property. Property-level expenses such as taxes, insurance, management, repairs and utilities are separate and must be paid from IRA funds.

Alternative-Investment and Trust-Deed Fees

An alternative investment not covered by a specialized category is generally subject to a $200 transaction fee when initially funded, increased or finally paid off. Preferred Trust’s published trust-deed transaction fee has been $20 for qualifying investments administered through a licensed mortgage broker, but the current schedule should be confirmed for the specific loan.

Digital-Currency Fees

The public schedule has listed a $500 initial setup charge for the cold-storage device, a $300 annual digital-currency depository fee and a $200 fee for each purchase or sale. Trading-platform, vendor, wire and blockchain fees can be additional.

Service and Exit Fees

Other published charges include $30 for an incoming or outgoing wire, $100 for a partial transfer out, $300 for a full transfer out or account termination, $200 for expedited processing, $40 for overnight delivery and $100 per hour for special research or service.

The total cost should include every likely stage: setup, annual administration, asset custody, transactions, wires, valuations, storage and exit. A fee structure that appears manageable while holding an asset can become expensive when it is sold or moved.

Cash-Balance Requirements

Preferred Trust requires an IRA to maintain at least $500 in cash. Its website states that this minimum balance is not available to pay fees. Investors therefore need cash above the minimum for administration and investment expenses.

Real-estate accounts are subject to a separate policy requiring a 5% cash reserve for property expenses. Precious-metals storage fees are treated as investment expenses and must be paid with qualified account funds rather than directly with personal funds.

Failure to maintain liquidity can force an asset sale, additional contribution or transfer from another eligible retirement account. Contribution limits still apply when new money is used.

Preferred Trust Precious Metals IRA Process

Preferred Trust acts as the custodian rather than the dealer or depository. The process begins when the investor opens and funds a self-directed IRA, chooses an independent precious-metals dealer, obtains an itemized quote and confirms that the selected products are IRA eligible. 

The investor then chooses an accepted depository and storage method and submits the required purchase authorization and dealer documents. After approving the direction, Preferred Trust sends funds from the IRA, the dealer ships the metals directly to the depository, and Preferred Trust records the asset and processes the depository billing.

The owner determines when to sell. A sale requires a dealer bid and a completed direction. Proceeds return to the IRA. An in-kind distribution moves the metals to personal ownership and can generate taxable income depending on the account and circumstances.

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IRA-Eligible Precious Metals

Preferred Trust identifies the usual minimum fineness standards: 99.5% for gold, 99.9% for silver and 99.95% for platinum and palladium. Qualifying bullion must also come from an accepted refiner, assayer, manufacturer or government mint and satisfy product-condition requirements.

American Gold Eagles are a statutory exception to the general 99.5% gold standard. Rare or collectible coins generally do not qualify. Investors should verify eligibility by exact mint, product, purity, weight and condition before authorizing payment.

Depository Storage

IRA-owned metals must remain in the physical possession of an approved bank or nonbank trustee arrangement. Preferred Trust establishes a depository subaccount for the IRA owner, while the selected vault physically safeguards the bullion.

Segregated storage keeps qualifying holdings separately identified and is generally more expensive. Nonsegregated or commingled storage holds fungible bullion with like products while maintaining ownership records. Investors should compare location, insurance, audits, fees, shipment procedures and product eligibility.

The depository fee is an IRA investment expense. Preferred Trust states that it must be paid using qualified account funds. Personal payment directly to the vault is not permitted under the company’s procedure.

Dealer Pricing and Buybacks

The annual custody fee is not the largest cost in every metals purchase. Dealers charge premiums above the underlying metal value and repurchase below retail. A wide spread can create a substantial immediate loss.

Before buying, investors should request the live spot price, the retail price and premium for each product, and the dealer’s current repurchase bid. The economic value of promotional or free metal should be compared with the total markup on the transaction.

Preferred Trust cautions that some dealers charge premiums well above spot. A buyback program does not normally guarantee the original purchase price, a profit or a fixed percentage of market value.

Cryptocurrency Custody and Risks

Preferred Trust uses cold-storage wallet technology rather than leaving all assets on a trading platform. Cold storage can reduce some online attack exposure, but it does not eliminate price, operational, fraud or regulatory risk.

Investors should understand who controls the keys, how transactions are authorized, how long transfers take, which blockchain fees apply and what happens if a vendor relationship changes. The combined setup, annual storage and transaction charges can make frequent trading expensive.

Cryptocurrency held through an IRA also remains subject to retirement-account rules. The owner cannot personally control the wallet or move IRA assets into a private wallet without taking a distribution.

Technology and Client Service

Preferred Trust offers a 24-hour online client portal for statements, balances and account records. Many account and investment forms can be submitted electronically. The company also organizes service through departments handling transfers, investments, accounting and client support.

Alternative transactions still require human review and coordination with outside parties. A real-estate closing, private placement or metals purchase can be delayed by incomplete documents, sending-custodian procedures, title problems or third-party responsiveness.

Investors with deadlines should confirm current processing requirements before signing a binding agreement. An expedited-processing fee does not necessarily resolve legal, issuer or depository delays.

Regulation and Account Protection

Preferred Trust states that it is a Nevada-licensed retail trust company subject to examination by the Nevada Financial Institutions Division. This regulatory status concerns custodial operations and does not constitute government approval of client-selected investments.

Protection varies by asset. Qualifying cash deposits may be eligible for applicable bank insurance, while precious metals depend on depository controls and insurance. Private equity, real estate, loans and digital currency are not protected against ordinary investment loss.

Investors should ask where cash is deposited, whether pass-through FDIC coverage applies, what insurance covers stored assets and how ownership is documented. No custody arrangement guarantees an asset’s value.

Prohibited Transactions and Disqualified Persons

Self-directed IRA owners must avoid direct and indirect dealings with disqualified persons. These generally include the owner, spouse, ancestors, lineal descendants, spouses of lineal descendants, fiduciaries and certain related businesses or service providers.

Potential violations include selling personal property to the IRA, borrowing from it, using IRA-owned real estate, paying personal expenses with IRA funds or using retirement assets for a related person’s benefit. The rules also apply to IRA-owned LLCs and indirect arrangements.

Preferred Trust’s processing of a transaction is not a legal determination that it complies with the tax code. Violations may jeopardize the IRA’s tax treatment. Independent advice is appropriate when family members, leverage, related businesses or compensation are involved.

UBIT, UDFI and Tax Considerations

An IRA can owe unrelated business income tax when it receives certain active business income through a pass-through entity. Unrelated debt-financed income may arise when an IRA investment uses borrowing.

These issues commonly affect operating businesses, leveraged real estate and private partnerships. The IRA may need to file Form 990-T and pay tax using account funds. Investors should evaluate potential tax exposure before investing.

Fair-Market Valuation Requirements

Private investments and real estate often lack observable market prices. The account owner or investment sponsor may need to provide annual fair-market-value documentation. A qualified appraisal may be required for certain distributions or conversions.

Valuation affects IRS reporting, account fees, Roth conversions, required minimum distributions and in-kind transfers. Investors should identify the valuation provider and expected cost before purchasing an illiquid asset.

Preferred Trust Company Reviews and Reputation

Preferred Trust has been BBB accredited since 2009 and held an A+ BBB rating at the time of review. The BBB customer-review page displayed a high average score, with many reviewers highlighting responsive and knowledgeable service.

Critical feedback has included concern about the expense of cryptocurrency trading and ongoing administration. This is consistent with the importance of comparing all-in fees, particularly for investors who expect frequent transactions.

BBB accreditation and ratings are not government approval or an assessment of investment quality. Reviews should be used to identify patterns in communication, processing and fee disclosure rather than to predict returns.

Potential Advantages of Preferred Trust Company

Preferred Trust’s potential advantages begin with its status as a Nevada-licensed retail trust company rather than merely an administrative intermediary. The company has provided self-directed IRA custody since 2007 and supports a broad selection of accepted alternative assets, including real estate, private placements, trust deeds, precious metals and cryptocurrency. 

Investors whose accounts hold only precious metals can use a dedicated fee structure with a flat $300 annual administration charge, while supported digital assets use dedicated cold-storage arrangements. The company also publishes its major annual, transaction and exit fees, and public reviews frequently mention responsive staff and helpful account assistance.

Potential Limitations of Preferred Trust Company

Potential limitations include value-based standard administration fees that increase with account size and reach $1,000 under the published schedule. Asset-specific charges for real estate, alternative investments, cryptocurrency and precious-metals transactions can add substantially to the base cost. 

The general $500 minimum cash balance and 5% property-reserve policy also reduce the amount available for investment. Exit costs can be meaningful, particularly when selling physical metals and terminating the account. 

Preferred Trust does not conduct investment due diligence, leaving the investor responsible for evaluating issuers, borrowers, dealers, pricing and suitability. Alternative assets may also be difficult to value, sell or transfer, and outcomes can depend on third parties such as sponsors, depositories, exchanges and property managers.

Preferred Trust vs. a Conventional Brokerage IRA

Preferred Trust’s self-directed IRA is primarily designed to custody alternative assets such as real estate, private deals, notes, precious metals and cryptocurrency. A conventional brokerage IRA, by contrast, generally focuses on publicly traded stocks, bonds, exchange-traded funds and mutual funds. 

Preferred Trust uses value-based or asset-specific fees, whereas many brokerage IRAs have no standard custody charge. Preferred Trust does not recommend investments, while the advice available through a conventional provider varies by platform and service. 

Alternative assets often have lower liquidity, require investor-supplied valuation documents, involve more third-party processing and impose a greater compliance burden. Publicly traded investments generally have readily available market prices, higher liquidity and faster execution.

A conventional brokerage IRA is generally the better fit for a passive, low-cost portfolio of public funds. Preferred Trust becomes relevant when the investor has a well-researched alternative investment that cannot be held efficiently at an ordinary broker.

Who May Be a Good Fit?

Preferred Trust may suit experienced real-estate investors, private lenders, precious-metals buyers and cryptocurrency investors who understand the relevant asset and want regulated IRA custody. It may also appeal to investors who value direct client service and clearly published account policies.

An appropriate client should be able to manage due diligence independently, maintain the required cash, pay specialized fees and obtain tax or legal advice when necessary.

Who May Want an Alternative?

The company may not be ideal for an investor holding only standard securities, making frequent trades or seeking fiduciary portfolio advice. Small accounts can experience a high effective annual cost, while larger mixed-asset accounts face increasing administration fees.

Another custodian may offer a more suitable flat-fee structure for a large account or lower transaction charges for a highly active strategy. Comparisons should use identical assets, values and expected activity.

Questions to Ask Before Opening an Account

Before opening an account, ask whether Preferred Trust will accept the exact asset and ownership structure and whether the metals-only or standard fee schedule will apply. Request a complete estimate of setup, annual, transaction, storage and exit costs, and confirm how much cash must remain in the account. 

Investors should also understand the required documents, expected processing time and responsibility for supplying annual fair-market valuations. Other important considerations include whether the investment could create unrelated business income tax or unrelated debt-financed income, whether a disqualified person is involved and which third parties will hold or service the asset. 

Finally, determine what insurance or account protection applies, how the investment can be sold or distributed, and what will happen if a sponsor, borrower, dealer or depository stops cooperating.

Final Assessment

Preferred Trust Company is an established Nevada-regulated custodian offering access to several important alternative-asset categories. Its experience with real estate, precious metals and cold-storage cryptocurrency, combined with published fees and generally favorable service reviews, can make it a credible option for knowledgeable self-directed investors.

Its main drawbacks are cost and complexity. Standard annual fees rise with account value, and transaction, asset-administration, storage, and exit charges can accumulate. Investors must also maintain cash reserves and take responsibility for due diligence, valuations, tax issues and prohibited-transaction compliance.

Preferred Trust is likely to be most useful when an investor has a specific, carefully researched alternative asset and values regulated custodial support. It is less compelling for a conventional public-market portfolio or an investor who expects the custodian to recommend or vet investments.

Before opening an account, obtain the latest written fee schedule, confirm asset acceptance and compare at least two custodians using the same balance and transaction assumptions. Review the custodian and the underlying investment separately; a regulated account structure does not make a speculative asset safe.