An IRA is an account that’s intended to be a resource for you once you have retired. If you attempt to use the account to purchase something for your immediate personal use or for the use of certain close relatives called “prohibited parties,” you can compromise the status of your account as a legitimate tax-advantaged IRA. Such a compromise is called a “prohibited transaction,” and it can lead to large tax penalties. To learn more about exactly which actions are prohibited, you can read the IRS guide to prohibited transactions. The bank or trust company that acts as custodian for your account is obligated to report a prohibited transaction if they see one happen, but they will not necessarily stop you from making a prohibited transaction.