Self Directed IRA Partnership

[Andrew Riggs]

Would a Self Directed IRA be subject to UBIT if I invested in an apartment building with 2 partners, all bringing equal equity and no debt to the deal? Example, the 3 of us form an LLC, buy a building, I use $60K of Self Directed IRA funds, they use cash or their own Self Directed IRA funds as well. We wouldn't finance anything and just put profits back into the LLC or pay dividends, which my portion would go back to my IRA. The other option is to buy a SF home in cash and rent for a year, then sell and reinvest in SF or small MF.