I think this is a good primer for anyone in the market for a short term rental. Feel free to jump in and discuss. But I thought this was turnkey - what's with all the delay? (biggerpockets.com)

It isn't a scam at all. It is a government approved long term retirement vehicle. If you open an Roth IRA, you fund it with POST TAX money. You pay the normal taxes via your paycheck or whatever. Then the money grows tax free. You don't take a hit when you start to pull from it.If you have a traditional IRA, you could convert it to a Roth IRA. You just have to pay the income taxes you would have paid in the first place. Then anything grows tax free. Even if you fill it with performing real estate. Every penny is tax free.Even when you go to sell it. The entire proceeds go to your Roth IRA and it is tax free.Here is a BP Blog post about it - https://www.biggerpockets.com/...

Of course. Roth IRAs came into being in 1997 with the Taxpayer Relief Act. I know that there are folks who have regular IRAs from before that time. You can always convert a standard IRA to a Roth and pay the taxes. That way all your real estate investments grow tax free. I wasn't accusing anyone of anything, just making a statement @Kristi K.. Most people can convert over and then start growing tax free.

@John Carbone and @Kristi K., most folks convert their IRA over to a Roth before they start investing from it. No taxes on profits made on the investment.

One reason is you don’t have to pay capital gains in an IRA. You have to pay ordinary income taxes eventually when you withdraw but it makes a lot of sense until then in some markets.

I owned a property once within a SDIRA. We also manage one currently for a client. Trying to shoehorn a vacation rental into a SDIRA is a huge and ongoing mess, fraught with tax, penalty, and even legal minefields. In the end, the juice isn't worth the squeeze. On the other hand, I did completely cash out a 401K once - $430K in total - paid all of the taxes and penalties and had about $280K left. My accountant was having heart palpitations. But I bought two cabins with the $280K, and they've produced around $850K in rents since I bought them in 2013. The two properties are probably worth in the $750-800K range. The appreciation and the income combined is around $1.3-1.4 million. Of course I've had expenses - knock off $150K for that over 10 years. That's still $1.25 million or so profit, from cashing out a 401K, paying $150K in penalties and taxes, and investing the remaining $280K.This is a great country!

Hey @John Carbone. Sure I hear what you are saying. There is a ton of ways to do this sort of stuff. Everyone has a different strategy. I was just saying it wasn't a scam. You are going to have to pay tax sometime on the 1031 unless you give your properties over to family then the cost basis goes up etc. Nothing new there.Capital gains are reasonable now, and near the low but you never know when that could change. It has varied between 15% up to almost 40% over the years. You just never know where it is going to go, especially with the state of govt debt. They could decide that capital gains is a good way to help pay that down.Everyone who contemplates this type of investing needs to calculate the best way to do it for themselves. Maybe you have a small IRA or Roth and that is it for retirement. By buying with the Roth, all the proceeds build up the retirement.Of course you can't use that money for other things as it all goes back into the Roth/IRA.

I have a great RE investor CPA and tax attorney so I have that covered. I don't do marketing other than the basics, I don't provide any kind of services, I don't have any contracts with any professional. I just call a guy. Also, I don't use my IRA or 401k's to invest with so that doesn't apply to me. I just was saying how many on here use their retirement accounts to invest with via a Roth.

@Michael Baum@Kristi K. and not to forget you can transfer an IRA to a Solo401k and convert to Roth inside the Solo401k. The Solo401k allows for no UBTI from debt financing. @Kristi K.the advantage of compounding cash flow from RE tax free with a Roth is far more advantageous than depreciation deductions or a 1031 exchange.

Roth retirement account. No taxes ever paid on any income

I never understood owning a rental in an ira. Why not just withdrawal from the ira, take the depreciation with the cost segregation against the income you took out and get a mortgage with some leverage on the property, and then you can still manage it yourself. You take a 10 percent early penalty hit but that’s a one time hit.

But I thought this was turnkey - what's with all the delay?But I thought this was turnkey

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