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Tax, SDIRAs & Cost Segregation
Account Closed
  • Rental Property Investor
  • Austin, TX
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I am not self-employed but want a Self-Directed 401(k) - ??

Account Closed
  • Rental Property Investor
  • Austin, TX
Posted Dec 12 2017, 06:27

I am interested in transferring my 401(k) from my previous company into a Self-Directed 401(k) - NOT a Self-Directed IRA - for the purpose of investing in cash flowing rental properties. However, I don not have a business. Do I simply need to start a random business and, if so, is there a minimum I need to earn each year to keep my sole proprietor status?

Also, I know that - with a Self-Directed IRA - there are a lot of disqualification scenarios. With a Self-Directed 401(k), are those still there? For example, can my business simply be a property management company and I manage the properties in the

Self-Directed 401(k) for a small fee or is this not allowed?

Finally, I have had a sole proprietorship before and the taxes for one are relatively easy to incorporate into personal tax returns. However, I am not sure how owning rental property inside a Self-Directed 401(k) will affect it. Anyone have 1st hand experience? Also, how does the depreciation tax benefit roll into taxes - or does it not?

*If you have a Self-Directed 401(k) and are happy with the entity that helped you set it up, please PM me! I am also in Austin so if you happen to know anyone local, I would appreciate their contact information too. Thanks!

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