Great Falls, MT · Member since 2016 · 2 posts · 0 votes
I am considering buying a chunk of vacant land inside an ira. The intent is to build a home on it in the future. My question revolves around the self dealing rules and management of the land while it is in the ira. Can the account owner or disqualified person inspect the property to see if maintenance is needed such as mowing, brush removal, and to verifying if trespassing is taking place? I understand we can not use the property, but do not know if inspecting the property on a monthly basis would cross the line of personally benefiting from the asset.
based on what you described inspecting the property owned by your IRA does not provide you personally any benefits. You are simply exercising good stewardship over IRA assets.
I am considering buying a chunk of vacant land inside an ira. The intent is to build a home on it in the future. My question revolves around the self dealing rules and management of the land while it is in the ira. Can the account owner or disqualified person inspect the property to see if maintenance is needed such as mowing, brush removal, and to verifying if trespassing is taking place? I understand we can not use the property, but do not know if inspecting the property on a monthly basis would cross the line of personally benefiting from the asset.
Hey Joel,
All of the activities you suggested are fine, as long as you won't be materially improving the property yourself. For example inspecting to see if brush removal is needed would be fine, hiring a company to remove the brush would be fine (using IRA funds of course), but actually removing the brush yourself would not be. You are free to follow your gardener around, telling him exactly where to mow, so long as you aren't pushing the mower.
Thank you guys for the advice, and clarification. I was under the assumption that I could do this, but wanted to make sure that being on the property did not cross the boundary of "using" the asset.