Self-directed IRA....Exemptions to prohibited transactions rule?

i.e. transactions with a "disqualified person"
Has anyone ever dealt with this? So that, for example John Smith's IRA can loan his S corp money? (where he is a 100% shareholder) Thanks
The revelation and inspiration to this came when i saw this:
http://www.powerhomebiz.com/guide/cases/Self-Directed%20IRAchrissie.htm "Another solution might be to apply for an exemption--that's right, an exemption--which would allow your self-directed IRA to make a loan to your S corp. Not too many advisors know this, but there is a provision in the Internal Revenue Code that gives the Secretary of Labor the power to grant exemptions to the prohibited transactions rule (see Section 4975(c)(2) of the Internal Revenue Code)--and the Secretary has issued both blanket exemptions and individual exemptions numerous times. For more information, you can contact the Department of Labor or visit the DOL Web site at http://www.dol.gov "
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IMNHO - Pigs will fly and Hell will freeze over before the commissioner grants such an exemption.
However, there is NO such exemption necessary if you have a C Corp. DANGER DANGER DANGER - WARNING - WARNING - WARNING - I am NOT NOT NOT NOT NOT recommending you use your IRA money to fund your business operations. I mention it ONLY in the interest of providing information. I think it is a BAD, STUPID, RISKY, UNREASONABLE AND FOOLISH idea to use IRA money to fund your own business. It goes against every fiber of my being to put all your eggs into one basket like that.
Please, please, please do NOT do it, Gene E. Utterback, EA, RFC, ABA
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Thank you for the C corp tip. I haven't been able to find that anywhere, but i will dig further.
Why is it bad to use an IRA to fund a business? I completely disagree. The whole point of entrepreneurship is risk, reward, and putting all your eggs into one basket for a window of time. There's no way around it, unless you are wealthy enough starting off to put only a small % of your net worth into a new business. I will be starting a business, and loaning my entire IRA to my corp.

these people are lying, it seems like i'll be able to do this:
http://www.selfdirectedira.org/index.php/prohibited "However there are hundreds of exceptions granted each year to the
prohibited transaction rules. The Department of Labor has been given
the power to grant these exceptions. One of the most important
exceptions is 96-62 which says that you only have to demonstrate that
your requested transaction is substantially similar to two or more
individual exemptions granted within the previous five years. This is called
a "class exemption". For further information please see
U.S Department of Labor Class Exemptions
Essentially if your transaction is an arms length transaction that is
a legitimate investment you can probably find similar exemptions that
have been approved. For example if you wanted to loan money from your
IRA to your wholly owned corporation it would probably be allowed if you
charged your corporation the same interest rates your bank would charge."
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