All Forum Posts by: Account Closed

Thanks for posting that article Marco. People are tired of being not only a slave to the bank, but a slave to the mediocre investments that their hard-earned retirement funds are currently tied up in. People know real estate. They understand it. As long as you are adhering to IRS guidelines (not living in the house, not performing "sweat equity", etc.) you can choose from a wide range of income-producing properties to diversify your self-directed retirement plan. If you are making your investments in a Roth account, all of that income is being generated tax-free. It seems like a no-brainer.

I couldn't agree more, Chris. It's hard to know which financial advisors you can trust these days. They are making a commission on products that they sell you. Are those products the best way to go if you're trying to build wealth? Maybe, but maybe not. You're taking a gamble to some degree, and using "hope" as your "strategy". Using a third-party administrator and self-directing some of those funds (from an IRA or 401k, or even from a HSA or ESA) puts some of the control back into your hands. Plus, the IRS allows so many different types of assets in a self-directed account...I think it's possible for everyone to find something that they are familiar with and understand, be it real estate, notes, LLC's or precious metals. You don't have to be an experienced investor to participate. You simply have to be willing to put in the time to educate yourself and carry out the necessary due diligence for whatever alternative asset you want to become involved with.

Thanks for sharing this!

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!