@Dmitriy Fomichenko I must have miscommunicated the concept I'm trying to achieve. I understand that distributions from an IRA are not qualified. I also understand that if I own more than 49% of an LLC that would conduct the management of the investment property, that would not qualify as well.
My idea was to have someone else create an LLC (maybe my in laws or someone else I trust) and have that LLC "manage" the property. The "management" fees would amount to about 70% of the cash flow of the property. The remaining 30% would go back to the IRA.
With the 70% of cash flow that is charged to the LLC for management. I would be an employee of the LLC and get paid as an employee the entire profits of the company.
That is why I stated it as extraction of cash flow as opposed to distribution. I wanted to know if anyone has done this before, and if so how they structured it
IF
