All Forum Posts by: Doreen Chaisson

The Solo(k) participant must be self employed, or earn 1099 income, but there is no limit to the hours worked. You can be employed full-time and still qualify. Any income deferred into the Plan, and any profit sharing contributions, have to come from the income earned from that company. For example, if you have a full time job elsewhere, working for a major corporation, and your own little side LLC that does yard work for people on the weekends, your salary deferrals and profit sharing can only come from the income earned by the yard work company. You cannot contribute any earnings from your other full time job.

The 1000 hour limitation is for any employees your wholly owned company may have.

If you have an LLC or sole proprietorship and you are the only employee, then you can have a Solo(k). If, however, you own a larger company, have several full-time employees (working more than 1,000 hours per year), then you would not qualify for a Solo(k).

Unfortunately, that would be a personal expense. Much in the same way your gas, car wear and tear, and time to travel to your local broker to buy IBM stock would not be reimbursed as an IRA expense.

If your IRA-owned LLC is a single member LLC, you can certainly continue to infuse additional capital. You would make your annual contribution to your IRA, and then direct your custodian to make an additional investment in your LLC.

You can't do this if you have additional disqualified parties invested in the LLC with your IRA.

To repeat what I clarified on a separate thread, PENSCO supports ACH, not scanned checks.  

Just to clarify, PENSCO does not support scanned checks, our clients use ACH.

As I'm sure you're aware, I cannot provide you with any client names, but hopefully there are some on this forum who may feel compelled to let you know their experiences.

General turn-around time for a real estate closing, with a fully funded account with available cash and all investment documents and authorizations in good order, is 5 - 7 business days from receipt of docs.

Your tenants should be able to do direct ACH to your custodian, without involving your own personal bank account or writing any checks at all. Many of our SD IRA clients' tenants use this method.

Hi Mike - Generally you can purchase rental properties within your SD IRA as long as it's not a property you or any disqualified parties (generally parents, grandparents, spouse, children, children's spouses) currently own, have ever owned, or currently or plan to live in.

The investment must be for the sole purpose of growing your IRA. You can't buy from, sell to, or rent to yourself or any disqualified parties. The property is owned by your IRA, all rental income flows back to your IRA, all expenses, taxes and repairs are paid by your IRA. The downpayment must come from the IRA. The property will be vested as "IRA Custodian Name, FBO (For the Benefit of) Your Name IRA"

You cannot use any personal money to pay for repairs, nor can you make the repairs/improvements/maintenance yourself. You'd have to hire outside contractors/vendors who would be willing to invoice your IRA for work done. Most custodians require a 3rd party property manager for these types of investments.

It is allowable for you to co-invest with your IRA as tenants-in-common, but that still does not change the rules. You and disqualified parties still cannot use the property nor make any repairs. Income is split between you and your IRA proportional to ownership, as are expenses.

This is just a brief overview - discussing with a qualified Self-Directed IRA custodian or professional familiar with the IRS rules and regulations on alternative asset investing is highly recommended.

It's also important to understand that even with a non-recourse loan for the IRA-owned properties, those funds can only be used for investments made by the IRA. That money cannot be used to make personal investments.

You cannot use any asset of your IRA/Roth IRA as collateral for a personal loan, nor can you use any equity in those IRA-owned properties for personal investment.

What you may be able to do is refinance those properties within the IRA via non-recourse loans, and then use the cash out to purchase additional investment properties within your retirement account, to grow your retirement portfolio.

Otherwise, it's hands-off those properties.