Partnering with a 401k

[David Jennings]

Good Morning

Im looking for the best way to partner my llc with my sisters 401k.

We are thinking of buying the property in the 401k and when the property sells the 401k pay my llc any thoughts on this Thanks David Jennings

[Jon Holdman]

Loans from a 401k don't have any penalties. The payments you make go back into the IRA. You're typically limited to 50% of the account balance or $50,000, whichever is less. The details are determined by the plan and not all plans allow loans. The biggest downside is that with most plans if you leave the company then you have to pay back the loan within a short time after you end your employment or else the outstanding balance is considered a distribution and subject to taxes and penalties.