Wanted to ask all of you for advice. I have some money in SDIRA that's just sitting there and not doing anything :(.. Its not much, only about 30K. Any advice what to do with it??
I've wanted to use it as a down payment for a property, but learned that if i'm financing using IRA, I'll pay UBIT. Plus, I wouldn't get any tax advantages being in an IRA. What are other options?
Any advice would be greatly appreciated.
You can't expect any personal tax advantages from your IRA. IRA is a retirement account, it is tax-deferred vehicle and regardless of what investment you buy in your IRA - it will not affect your personal tax situation.
If you decide to buy an investment property in your IRA you must use non-recourse financing. Typically those types of loans require about 40% down-payment plus reserves. Here is a list of lenders offering such financing for retirement accounts:
If you use leverage to purchase a property in your IRA there will be UBIT impact, but it would not be huge as to discourage you from going this route. You can deduct portion of the expenses including depreciation and what's left will be subject to UBIT. And remember, since you are using leverage your return will be higher compared if you were using all cash purchase. You've got to run the numbers and I'm sure you can find the right investment to fit your strategy.
Have you looked into investing in notes? You can be the bank and gain a nice return without tenants, toilets or termites
@Chris Seveney . Sure will.. Thanks :)
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