Self Directed IRA Information

7 Replies

Hi @Charisse Patterson

I opened a SD IRA last year and invested with a RE hedge fund company. Probably one of the better investments I've made, I just wish I would of done it earlier.

I also looked at buying property with the SD IRA but found the rules to be too strict.


SD IRA's are a great way to use creative financing for REI, but you need to know what you're doing & what you can & cannot do. They can be a little complicated. There are restrictions, rules, etc. that you must follow. Find a good custodian and get educated before you do anything.

I started investing in real estate with my Self Directed IRA. They do not lend themselves well to all types of real estate investing. I started as a syndication investor. They do work well for syndication investments, considering the restrictions involved with SDIRAs.

Originally posted by @Charisse Patterson :

@Taylor L. Pardon my lack of knowledge, but what I a syndication investment/investor?

Syndications are when we pool money from passive investors to buy real estate. A typical syndication has passive investors (Limited Partners) and active investors (General Partners). The upside for the Limited Partners is that they do not have to do anything with regards to running the properties. The General Partners are responsible for all of the acqusition, operations, and sale, and 3rd party property management is hired to handle the day-to-day operations.

@Charisse Patterson the biggest caveat is that you can’t use it to actively invest in your own project. That means you can’t use it to purchase a rental property and benefit from cash flow. You would have to use it as a lending vehicle to someone else’s project. There are exceptions, but you’ll want to get with a good custodian to talk with them. I would recommend getting checkbook control as well too. Feel free to reach out with questions.

If you are planning to invest in a leveraged investment with an SDIRA, you need to look up UBIT / UDIF, taxes on prorated portion of the profits.  This is often a big surprise for SDIRA investors.


Charles LeMaire

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