All Forum Posts by: Joseph Hammel

Hi, So I have a self directed "checkbook control" roth that currently holds 2 properties free and clear. I'm looking to change to the Roth Solo 401k. I currently use Advanta IRA and have been really happy with them. My main portfolio is doing very well at 26 or so properties and 94 ish units. I want to have the ability to do leverage in the 401k and I understand that the UBIT tax is not applicable in the 401. I also want to be able to contribute to the 20500 at 100%. So I will walk through my plan and add questions along the way if any of you gurus want to verify I'm on the right track.

Step one. Open solo roth 401k and roll the IRA into it. Does anything need to change with the holding LLC with that change?

Step two. "pay myself" a fee for managing or consulting or whatever and 1099 myself $20500. Then I get to write that off of my rentals right? I know, not the 401, talking my main portfolio.

Step 3. Contribute the 20500 to my new Solo 401k. Because its roth I pay the taxes now. 

Step 4. File a sched c on the 20500 and pay the tax and self employment tax on it. 

Between writing it off on the rentals I will pretty much just be paying the self employment tax. 

Second question, Can I still make $6000 roth contributions as well? (my wife still has a w2 job) If she quit would I be able too with my sched c income?

I have some higher level questions above this like adding employees ect. Ready to talk to an expert. Willing to move to a different admin as well.

Thanks!

These are great also.

These things are da bomb. Don't even need soldering skills.

What kind of water heater? Gas, elec, size, ect

Try every small local bank in your area.

Oh, Dec deal was on 7 units but it's a 4unit, DP, and sf all touching each other and all on one loan. The special is only 1-4 units but since they were on 3 diff parcels they made it work all on one loan. 

Quote from @Tim Swierczek:

Quote from @Chris Mason:

Quote from @Joseph Hammel:

Closing paid on the 11 unit I bought in Sept. These rates are STILL out there folks. 

 6 months ago. lol.

If it really were that simple, I'd buy a bunch of Amazon stock at the February 2020 price.

Or I would tell you the price I paid in Feb 2020, and insist that you could "still" buy it for that price. 

 So True!

I currently have an offer in hand from these guys to cash out refi two four plexes I bought in Aug on a fire sale. Quickly turned around. I'm waiting on RCU to review my 2021 p/l because they are giving doing 3.25 for 10 on a 25 am TODAY. I also have an offer from River Bank in LaCross to to a 80 ltv cash refi on a 16plex at 3.5 for 5. 

Just for giggles a 5% 30yr is = payment to a 4.125% 25yr. Only pro would be if you really were going to hold it that long or never refi. You even made that point to me in one of our talks a few years ago @Tim Swierczek That's not including the crazy points in the op post.  

Quote from @Chris Mason:

Quote from @Joseph Hammel:

Closing paid on the 11 unit I bought in Sept. These rates are STILL out there folks. 

 6 months ago. lol.

If it really were that simple, I'd buy a bunch of Amazon stock at the February 2020 price.

Or I would tell you the price I paid in Feb 2020, and insist that you could "still" buy it for that price. 

 I'm still getting these rates TODAY from local lenders and I live local to OP. 1 1/2 hrs away. Here's one we did Dec 20th 2021. 2.875% 25 am 5 yr lock.

Closing paid on the 11 unit I bought in Sept. These rates are STILL out there folks. 

Quote from @Meredith Mihm:

Quote from @Joseph Hammel:

Quote from @Meredith Mihm:

Quote from @Joseph Hammel:

Westconsin CU is doing 2.875 locked for 5 years with a 25 AM

RCU is doing 3.25 locked for 10 with a 25 am. Few hundred in bank orig fees. No points.

Wow, that does give me some thinking to do!  Thanks! 

 I hit you up if you want to connect. I've noticed there may be some deals in Winona. 

Yes, the 30% rule keeps the rental market in Winona pretty hot. We've missed out on a few deals because we were too scared to dive in. What are you looking for? 
Thanks again, I just ran the numbers and I think either of those would be better than my current option, and still cash flow a bit better. 

 RCU stands for Royal Credit Union, right? I'll check River Bank too. 

Yes, Royal Credit Union. https://www.rcu.org/
I was referring to 30 year mortgages not the 30% rule. I usually shoot for a 10 cap.
An example would be a property that makes 30k a year rent minus expense (not debt) would be 300k. 30/300= .1 So a higher cap rate is a better deal. 
I use 5% for vacancy and 16% for maint and capx.