SDIRA and Flips

[Bernie Huckestein]

It's not completely clear to me as the comments do vary but best I can tell unless you re going to do only 1 or 2 you really shouldn't flip from SDIRA fund...I guess first is that correct?

However, if have a contractor who I know and trust, have the systems in place to find the deals, and have the funds in SDIRA"

1) Could I (the SDIRA) lease option the property to the contractor for a very small amount (plus provide rehab funds)...I would collect a regular interest rate (not as high as hard money) but then share in profits after contractor sells the property for example 80/20 (keep in mind the contractor would be getting paid his normal rate during rehab, I found the property, my SDIRA purchased the property and lent rehab money to the contractor).  --  I am not at all sure this gets me away from an dealer status...does it?

2) As a second alternative I suppose since this contractor would be no relation to me at all I could loan him the money from my SDIRA for purchase and rehab but structure the loan paper to share profits in some way upon sale again 80/20 for examle?  Can something like that work?  

I could be okay with just being a hard money lender but in this case I will have the systems / lead generation to find potential opportunities. My original purpose was to set this up for buy and hold which I will do outside my IRA, I really don;t want to pass on flip opportunities but since I have another full-time W2 job which requires frequent travel -- I don't think I have time to wholesale effectively + that is for sure dealer status.

Appreciate comments, thoughts, or experience the BP community could provide.

Thank you