How can I access money tied up in IRA's and other funds?

[Will Foster]

Hello all. Next year I want to begin the process of buying my first multifamily unit, which I want to live in one unit. But all my money is in IRA's and other money funds, and I think I'm going to need to tap into those accounts to get started. The question is, how do I do this? I hear the words, "Self Directed IRA." used a lot on BP, as a way to purchase your property, but from reading about the rules of using this method to buy real estate, "The IRS prohibits certain actions. For example, neither the IRA holder nor any disqualified persons to that plan may live in or vacation in the property." That sounds like I would not be able to house hack. So I'm asking the experienced investors of BP, how do I use the money in my IRA's to begin investing? Do I cash out a portion of my IRA's and pay the penalties and the taxes? Are there other ways of accessing these funds? Thanks for your time. Will

[Dmitriy Fomichenko]

Will, you can setup and use self-directed IRA to invest in real estate, but the IRS rules prohibit you from receiving any personal benefits from such investment (living in the property) or providing any services (doing the work yourself). It has to be used strictly for investment without your personal involvement, so you are correct, house hacking strategy would not work with SD IRA.

If you are eligible for a Solo 401k plan you can rollover funds there and take a personal loan form it (limited to $50K), which can be in turn use to make personal investment.