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Tax, SDIRAs & Cost Segregation

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Sandy Uhlmann
  • Investor
  • Jefferson City, MO
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309
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Is dealer status avoided if real estate activity is done using a self directed IRA?

Sandy Uhlmann
  • Investor
  • Jefferson City, MO
Posted Nov 22 2014, 04:36

I recently set up a self directed IRA through Midatlantic. I was wondering if I use my self directed IRA money to wholesale properties, does that avoid the dreaded dealer status?

One of the Midatlantic reps suggested this was a good way for people that have a relatively small amount of cash in their self directed account to increase their cash quickly. He suggested that I use a very small amount of IRA funds to get the property under contract, when the contract is sold to the end buyer, those funds would get put back into my self directed IRA and I could repeat the process.

Up to this point in time, I have been fearful about fix and flips or even wholesaling because I feared the dealer status. I was wondering if the dealer status can be avoided if I keep everything within my self directed IRA?

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