Making a Prohibited Transaction in an IRA will cause a penalty. The list of Prohibited Transactions is reasonable and easy to learn:

^{_{An IRA may not:}}

• Use funds to buy Life Insurance

• Use funds to buy collectibles

• Take action that would be a current benefit to a Disqualified Person

^{_{Who are Disqualified Persons:}}

• Transactions between the IRA and businesses under the IRA owner’s control
• Lending money between an IRA and a disqualified person 
• The IRA extending credit to a disqualified person
• The IRA owner guaranteeing a loan for real estate purchased by the IRA
• The IRA owner using the IRA as security for a personal loan
• Selling, exchanging, or leasing of any property between an IRA and a disqualified person. 
• Receiving or furnishing goods, services, or facilities between an IRA and a disqualified person. For example, The IRA owner cannot use personal furniture to furnish the IRAs rental property. Another example:  The IRA cannot buy property and have the IRA owner renovate it himself or herself or hire a relative to renovate it.
• Transferring assets or income from the plan to a disqualified person
• Transferring income or assets of an IRA to the IRA’s fiduciary acting in his own financial interest. For example, the IRA cannot lend money to the owner’s CPA.
  

• Artwork
• Rugs
• Antiques
• Metals
• Gems
• Stamps
• Coins
  
• exceptions for U.S. Treasury-minted gold and silver coins in one, one-half, one-quarter and one-tenth ounce.
  
• exceptions also include certain platinum coins and gold, silver, palladium and platinum bullion
• Alcoholic beverages
• Other tangible personal property