All Forum Posts by: Jeffrey Dixon

The IRA will buy the property and own it, so the rents and profits must go into the IRA. You can take distributions from the IRA, but that it is only way to end up with the funds. You will pay taxes on the distributions.

You cannot sell a property you own to your retirement account. Selling it to a 3rd party and then to the IRA is still prohibited.

Dana,

Actually, these are the prohibited parties to your Solo 401k. None of them can do any work on the property. Neither can a business they are associated with. 

• you
• your spouse
• your parents and/or your adoptive parents
• your natural grandparents
• your natural children and/or your adopted children
• your stepchildren
• The spouse of your natural children
• your grandchildren
• Any fiduciary
• Any people providing services to your IRA

uDirect IRA Services can help answer your questions about investing outside of the stock market with your retirement dollars. Our clients buy rental properties, make secured real estate loans and invest in syndications and Private Placement Memorandums.

If you do not work there anymore you can move the funds to a Self-Directed IRA and have the IRA buy real estate.

I am with uDirect IRA Services. Our Solo 401 k allows for a loan to be taken. We can also help with alternative investments, like buying rental properties or making secured real estate loans to others.

When the IRA makes the purchase, the custodian is involved with every step. When you use the LLC to make the purchase, the custodian is not involved. It is faster to buy the property and pay the bills using the LLC

There are a few states that we exclude. We have found that some state governments are more problematic to deal with. The IRA owned LLC bypasses that. You may find that using the IRA owned LLC is easier when making a real estate purchase, especially when paying bills for the property.

Are you still working for the company that offered the 401k? If so, then the 401k must have an In-Service provision to eligible to move the funds. If from a prior employer you can move them. You must be self-employed with your business to be eligible for a Solo 401k. You cannot have any full time employees with that business or any business you own. 

You would use a new LLC that is owned originally and exclusively by the IRA.