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Updated over 8 years ago,
Solo 401k Roth and Traditional Funds Accounting
I am new to bigger pockets and currently setting up a checkbook solo 401k plan with the intention of investing in real estate.
One point of confusion is how to account for Roth and and traditional funds in the bank accounts. For example, If I purchase a property with 60% Roth funds and 40% traditional funds, do I split the proceeds and expenses proportionately between the two accounts?
Of course, the goal is to have a non-recourse loan and 100% Roth ownership of the property to avoid UDFI tax. What would be the technique to get there if I purchased the property in the scenario above and then obtained a loan?
Many thanks,
Jim