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Updated over 5 years ago on . Most recent reply
Help w/ self-directed 401K
I just got a contract on a duplex that I need to execute by Jan 31st. I’d like to fund it with my 401k and was planning to use Equity Trust. I’m now reading reviews and am second guessing Equity Trust. Should I find another custodian? Scrap my approach and go after a hard $ lender?
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#1 New Member Introductions Contributor
- Solo 401k Expert
- Anaheim Hills, CA
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#1 New Member Introductions Contributor
- Solo 401k Expert
- Anaheim Hills, CA
You can't purchase property using self-directed 401k that you personally in contract to buy. You are considered "disqualified person" to your 401k and assigning this contract to your 401k would be considered "prohibited transaction":
https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-prohibited-transactions
The proper steps would be:
1) Establish and fund self-directed 401k
2) Find and purchase investment
- Dmitriy Fomichenko
- (949) 228-9393
