Self Directed IRA suggestions?

[Greg W.]

Hey All,

I've become interested in the idea of a self directed IRA as I'm growing increasingly put off by my Edward Jones dude trying to convince me that a 6% rate of return is awesome. I'm also looking into the prospects of a self directed IRA because I'm intrigued by the idea of having tax liens within such an IRA.

That said, what self-directed IRA would you all recommend? Has anyone tried Guidant Financial? What are the pros and cons you all have experienced with a self directed IRA?

[Account Closed]

Hi Mike,

Self-directed retirement accounts give you the freedom to invest in the things that you know and understand best - not what your advisor at Edward Jones thinks is best. We have many clients that purchase real estate for the purposes of renting and rehabbing. With rehabbing, all expenses relating to the property need to be paid with the cash in the IRA, since the IRA is the property owner. Everything flows in and out of the account nicely, with the goal being that you're making a profit and watching it grow either tax-deferred or tax-free (in a Roth account).

Can I flip a house using my IRA is a question I often get asked. Technically, the answer is yes, you can flip a house using your IRA. The better question is do you want to flip a house inside your IRA. What can become involved when you flip a house with your IRA is Unrelated Business Taxable Income (UBTI). You can't have an unfair advantage over the competition by not paying taxes. When you flip a house with your IRA, the IRS might consider the house inventory and require taxes to be paid. Usually one or two within a year will not raise any red flags.

Tax liens can be a great alternative to flipping if that is something you are looking into.

Best of luck, whatever you decide!