CFP or CPA

[Kevin S.]

Hi BP members,

I want to use my 401K for REI. I looked into SDIRA but prefer to do a Roth conversion (pay taxes) and then invest in RE within the Roth. I am able to withdraw without penalty.

Has any BP members done that?  Can use advise as to how it was done.  

I assume I need a CFP first to figure out the Roth conversion part and once converted then in comes CPA?  Do I just need CPA?

Appreciate all help.  Thanks.

[Brett Synicky]

Quote from @Kevin S.:

Hi BP members,

I want to use my 401K for REI. I looked into SDIRA but prefer to do a Roth conversion (pay taxes) and then invest in RE within the Roth. I am able to withdraw without penalty.

Has any BP members done that?  Can use advise as to how it was done.  

I assume I need a CFP first to figure out the Roth conversion part and once converted then in comes CPA?  Do I just need CPA?

Appreciate all help.  Thanks.

 Hi Kevin this is not an uncommon method of investing.  Many people have invested in RE within a pre-tax and Roth account.  You can do this with a Solo 401(k) or SDIRA.  Both have the Roth option.  401k has Roth built in, SDIRA is either pre-tax or Roth.   Or both but either way, separate plans. It's a good idea to work with a CPA who understands self Directed Retirement accounts and I definitely recommend you check with a CPA before you do a Roth Conversion so you know the tax implications.  It's definitely not a terrible idea to pay taxes on the seed versus the harvest, assuming you can afford that.  You can do all at once or chunk it over several years or whatever amounts and timeline makes sense for you.  Additionally there are plans that give you checkbook control and plans where you need to go through the custodian for all transactions.   

You can learn more about Checkbook IRA here: https://www.biggerpockets.com/member-blogs/2810/blog_posts/2...