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Updated about 7 years ago,

User Stats

82
Posts
35
Votes
David Morgan
  • Rental Property Investor
  • Knoxville, TN
35
Votes |
82
Posts

Self-directed Roth 401(k) questions

David Morgan
  • Rental Property Investor
  • Knoxville, TN
Posted
I have a few questions about investing in real estate with a Roth 401(k): 1.) If at age 45 I buy a vacation rental, and at age 59.5 I want to start using it for family vacations, would I first need to distribute the property? And if I then needed to sell it, or I died a year later, how would the basis be determined? (I'm not in a common property state -- would it matter where the property is located? ) 2.) Would seller financing or seller carryback without a personal guarantee count as non recourse lending? 3.) If I max my Roth 401(k) contribution -- let's say I can put no more than $30k into it based on my income -- can I put an additional $5500 into a traditional IRA and roll it into the 401(k)? If so, how soon? 4.) Assuming I have a Roth 401k at etrade, where half my account is tied up in equities, and the other half in cash, can I move the cash portion into a new self-directed 401(k) to use for real estate? How does it work if you want to trade stocks and options as well as real estate and paper? 5.) If I'm a sole proprietor this year, but get smart and form a single member LLC next year for my self employed earned income, can I use the same 401(k), or will I need to start a new one? Thank you for your help!

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