Real Estate investing with a IRA/Solo 401K

Real Estate investing with a IRA/Solo 401K

IN · Member since 2010 · 6 posts · 0 votes

Has anyone had any experience investing in real estate using a IRA or 401K account? Just wondering how well this works?

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  • Real Estate Investor · OH · Member since 2009 · 37 posts · 11 votes
    16y

    I have from a title and escrow perspective. It's doable just note that you have to work with there terms and approval requirements. Also note that they'll likely be the ones that have to sign closing documents, etc. Feel free to contact me directly with specific questions.

  • Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
    16y

    Moved to SDIRA forum.

  • IN · Member since 2010 · 6 posts · 0 votes
    16y
    Originally posted by Jon Holdman:
    Moved to SDIRA forum.


    Jon- Educate me please. SDIRA?
  • IN · Member since 2010 · 6 posts · 0 votes
    16y
    Originally posted by Joe Deno:
    Originally posted by Jon Holdman:
    Moved to SDIRA forum.


    Jon- Educate me please. SDIRA?


    HAHA, never mind. I got it!
  • Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
    16y

    OK.

    There are a number of existing posts, you're asking a pretty broad question.

    IMHO, its tough to directly invest in RE in an IRA. Rental real estate is usually more profitable when you can leverage it. But leverage in a non-Roth IRA is troublesome due to the UBIT (unrelated business income tax). Not to mention it hard to get financing for an IRA and expensive. Doing flips or any other active business is fully subject to UBIT, making it even worse than rentals. And, having paid taxes once inside the IRA you get to pay them again when you withdraw the money.

    Originating loans in an IRA, OTOH, is pretty attractive. Because they're passive, you avoid these taxes.

    Lots of other opinions. I hate to say "go read" rather than answering your question. But it would take a book to fully answer, and we've had a number of healthy discussions about various aspects of this topic.

  • IN · Member since 2010 · 6 posts · 0 votes
    16y

    Thanks Jon. Appreciate the reply.

    Simply put, I'm trying to find out why or why not one would not use an IRA to buy RE within the account to spread risk or move risk away from mutal funds and stock? Especially if te account owner is +50 years old and wishing to secure their money until retirement.

  • Real Estate Investor · Fishers, IN · Member since 2009 · 408 posts · 196 votes
    16y

    Joe,

    We originate plenty of Self Directed IRA and Solo 401k transactions a month. I would be glad to do a conference call and answer any question you might have on the process. The paperwork and processing can be a burden, and its best to get your information correct the first time to fund the deal properly.

    I am here to advise and serve, so no worries on whatever you ask. I will not use my time to sell you anything, just help.

  • IN · Member since 2010 · 6 posts · 0 votes
    16y

    Kevin,
    I would like to get on a phone call with you next week to discuss this option briefly to see if it works for the scenario.
    Joe

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