MANAGING YOUR ACCOUNT

Zero-Value Assets and Distributions

Below is everything you need to know about Zero-Value Assets and Distributions. Requests for zero-value distributions can be easily submitted via the NDTCO Client Portal at any time.

person doing their annual fair market valuation

ZERO-VALUE ASSETS

What to Know

Unfortunately, not all investments always go as planned. In the specific case that you have to declare an investment as worthless, you will need specific documentation to complete a zero-value distribution.  

When an investment is determined to be of zero value, you need to have it removed from your self-directed account. You can easily submit a request to do so via the NDTCO Client Portal:

  • Log into the NDTCO Client Portal.
  • On the Overview page, find the asset that needs to be declared as zero value. Click “Take Action” to the right of that asset and click on “Valuate.”
  • On the “Fair Market Valuation Page,” check the box that states “I would like to declare this asset is worth $0 and have it removed from my account.”
  • Provide any additional information, upload supporting documentation as necessary, check the box to agree to “Terms and Conditions,” and click “Submit.”

Some investments, such as precious metals and real estate, are not eligible for zero-value distributions since they are incapable of losing their value.

Private Equity and Debt/Promissory Notes Investments are examples or investments that can be Zero-Value

Acceptable Documents
 
  •  A letter from a CPA or Attorney
  • A letter from a managing member on company letterhead
  • Any official court documents, including bankruptcy or criminal filings

Not Acceptable Documents

  •  Schedule K-1
  • Documents from the Secretary of State website
  • Newspaper or website clippings
  • Non-authorized signers (i.e., the janitor or landlord)
  • Electronic correspondences with the company (e-mail)
  • Personal research
  • Voicemails and text messages

Please note that we cannot accept emails as proof of value.

Acceptable Documents
  • Death certificate if the borrower is deceased
  • A signed letter from the borrower explaining why he/she are unable to pay
  • Any official court documents, including bankruptcy or criminal filings or receivership documents
  • Secretary of State information showing the borrowing entity is dissolved

Please note that we cannot accept emails as proof of value.

NDTCO will distribute the asset to you valued at $1. The value is low enough that it will not be reported to the IRS.

Slide

Education Center

Want to learn more about self-directed investments?

Essential Viewing

Camper standing solo outside of their tent looking at the mountains
Play Video about Camper standing solo outside of their tent looking at the mountains
Foundations of a Self Directed IRA

Upcoming IRA Events