Self-dealing is when your self-directed retirement account makes a prohibited transaction with the same person who owns it (you). You must keep your investments "at arm's length".
Your Self-Directed IRA should benefit from investments and transactions. You should not.
You are a disqualified person. Just like other disqualified persons, you should not be transacting or forming a conflict of interest between yourself and your IRA. Think of assets in your name and your IRA's name as two different parties.
What are some common self-dealing problem examples?
Commingling funds from your personal account and your IRA
Transferring/selling assets to or from a disqualified person (you) and the IRA, so that you move a taxable investment into your IRA, or one of your IRA investments to your personal taxable accounts.
Owning stock or a house in your name and then selling it to your IRA
Transacting with a company with your IRA in which you own 50%+ of or hold a key leadership position
Paying yourself from your IRA, whether in the form of salary, commissions or discounting/increasing costs other areas of a transaction because of your work
Utilizing your own IRA's investment for benefit and pleasure, such as staying in your IRA's investment real estate for vacation, buying raw land from your IRA, or building a cabin and hunting ground.
- Putting your personal name on the final paperwork of investments, instead of signing as your IRA LLC manager.