How To Buy A Retirement Home With Retirement Funds: SDIRAs, IRA-LLCs, Solo 401k Plans

Can I Buy A Retirement Home With My Self-Directed IRA, Solo 401k, or DB Plan?

You can buy your dream retirement home with your self-directed IRA, IRA-LLC, Solo 401(k), or Defined Benefit Plan. Your IRA Checkbook  and Checkbook 401k can be used to purchase real property worldwide – Playa del Carmen, Mexico to Beijing, China and anywhere in-between. However, you must be aware of the prohibited transaction tax rules that apply to real estate investment. This post will address key questions about purchasing a vacation home with tax-favored retirement accounts. Continue reading “How To Buy A Retirement Home With Retirement Funds: SDIRAs, IRA-LLCs, Solo 401k Plans”

Private Lending IRAs: The SDIRA Checkbook Retirement Account Advantage

Private Lending IRAs and Checkbook Control

Private lending is the ideal investment for an IRA…and less than ideal outside of an IRA.

Understanding why that’s the case – and why a checkbook control IRA is crucial to maximizing private lending investment returns – requires an understanding of tax and investment concepts. In this post we’ll cover the income tax treatment of private lending inside and outside of retirement accounts (IRAs, Solo 401k plans) and why a Self-Directed IRA with Checkbook Control is the IRA you need for private lending. Additionally, if you’re a real estate investor, you’ll learn how to get funding for deals by leveraging the IRAs of private lenders. Continue reading “Private Lending IRAs: The SDIRA Checkbook Retirement Account Advantage”

Beyond Prohibited Transactions: The Exclusive Benefit Rule

Among the first concepts introduced to self-directed IRA and Solo 401(k) investors are “prohibited transactions” and “disqualified persons.” While those are certainly key concepts, there several others to be aware of; among those is the “Exclusive Benefit Rule.” Continue reading “Beyond Prohibited Transactions: The Exclusive Benefit Rule”

Beyond Prohibited Transactions: The DOL Interpretive Bulletin

Benefiting from tax-advantaged retirement funds before retirement age would be a beautiful thing, especially for those of that leverage the power of Solo 401(k)s and Checkbook IRAs. But, as that would defeat the intent of those accounts, the Prohibited Transaction Rules of IRC 4975 were created. Although written broadly, the innovative investor can contrive many ways to circumvent those rules.

However, beyond the letter of the law, the IRS has some additional tools at its disposal with which to counter creative strategies. Those include the Step Transaction Doctrine, the Exclusive Benefit Rule, and the Plan Asset Rule. For cases in which those rules may not apply, the IRS has the Department of Labor Interpretive Bulletin ERISA IB 75-2. Continue reading “Beyond Prohibited Transactions: The DOL Interpretive Bulletin”