All Forum Posts by: Brett Synicky

Technically any bank can operate as an IRA custodian but they don't all do it. There are companies like midland used to that will act as custodian. I think what you're referring to is a checkbook IRA so you can bypass the custodian when performing transactions/investing and all assets/accounts will be held in the name of a special purpose LLC or Trust which is the instrument that gives you checkbook control. Happy hunting!

@Kelly Taylor who doesn’t like tax free atm withdrawals?  the more Roth the merrier!  Have you looked at a solo 401k?   Roth and pre-tax built in so makes Roth conversions simpler among other things.  What do you wish to invest in?  

@Jun Lee Solo 401k is a great vehicle for investing!   Glad you’re looking into it. I love seeing people invest using it, especially in their Roth. 

@Kaushik Sarkar Lot's of good providers our there.  Learn about Checkbook IRA vs. SDIRAs.  Also Solo 401k could be a better option for you if you're self employed with no FT W2 employees.   

@Maria Jeanette Educate yourself on the difference between Checkbook IRA and Custodial IRA. I believe Equity Trust does both. They are a reputable company. Understand the difference between owning RE personally versus in a retirement plan. It can make more sense to do PML's in the IRA instead of rentals, particularly if you use leverage since the IRA will incur UDFI on that portion of the income derived from the mortgage. Also Solo 401k is exempt from that tax if you qualify instead of using SDIRA.  

@Marcus Robert Well done on your investment prowess so far.  A few things in response to what you wrote:

1.  Some employers, (when you're 50+) 401k adoption agreements will allow you to do an "in-service-rollover".  Basically you stay working there and rollover funds into another qualified plan.   Check with the plan administrator and use that verbiage.  

2.  59.5 is when you can take distributions without penalty.  As others have said there is no way for you to access those funds for personal use without taking a distribution which will be a taxable event...

3.  When you transfer retirement funds into a self directed account you can certainly buy real estate with it.  Something to consider is to convert the pre-tax funds/assets to Roth so you have tax free atm withdrawals at retirement.   When you convert an asset to Roth you have to get a third party valuation and often they come in at a major discount..25-60% so your taxable amount is way lower than the actual conversion.  

4.  Educate yourself on the differences between checkbook control and custodial control.   Also consider Checkbook IRA vs. Solo 401k.   Some significant differences between the two.  

Godspeed in this journey.  

@Sam Fujii Has to be non recourse.   List of lenders here:  Non-Recourse Lenders

@Richard Nguyen there are lots of good companies out there that do NOT charge asset based fees of any sort. Educate yourself on the difference between Checkbook IRA and Full Custodial IRA. Though fee schedules vary by company, generally speaking, you'll pay more up front for checkbook control and less over time, since the full custodial companies will have transaction fees not to mention the red tape of going through the custodian for all transactions. Checkbook control bypasses the custodian. Because of all of this depending on your investment goals, one may make more sense than the other. You can transfer cash and assets from one IRA to another IRA anytime, this is a non-taxable event. Just some wire fees and maybe termination fees from the custodian and your time to consider...

@Matthew Holden

Do you have checkbook control or full custodial SDIRA? Tasty Trade is a brokerage that has allowed IRA LLCs/Trusts to open brokerage accounts. Worst case you can transfer the money from the current custodian into Fidelity and back and forth it would just create work for you and possible wiring fees....

@Kevin S. It can make sense to buy real estate within your IRA using a Checkbook IRA.  If you use debt to buy the real estate the IRA will incur UBIT so educate yourself on that.  Some opt for private lending to avoid this tax and still have investments secured by RE.   A Solo 401k which is exempt from UBIT on leveraged real estate may be a better option if you have legitimate self employment activity.  Additionally, educate yourself on disqualified persons and prohibited transactions.  

As far as Roth Conversion, it's the question of do you want to pay taxes on the seed or the harvest.  The answer is usually obvious if you can take the tax hit, but in your case assuming 5-7 years away from needing/wanting to distribute money to yourself, this is a decision you need to make with your tax advisor. There are certainly investments you can make to increase the principal in the net 5-7 years.  

You should consider investing in RE outside your retirement account as well since there are different tax benefits available.