Seeking a bit of guidance on SDIRAs.
Background: I own a handful of properties in Maine and am looking to grow my portfolio. My grandmother has a sizable IRA and is becoming more and more apprehensive about her traditional investments (stocks, bond, etc.), and more and more interested in moving her funds to a SDIRA to invest in real estate.
Now from my research I understand that she cannot use the funds to be a private lender to my business, as I am considered her direct lineage. That said, there’s a bit of a plot twist in that her husband is my step grandfather in which I have no relation to. It seems to be a “grey” area with step relation, but wondering if it would be permissible to transfer funds into a SDIRA under my step grandfather and he be a private lender to my business?
In addition, I understand that my grandmother can partner on deals with disqualified persons (i.e. me). This could be a very powerful option as an alternative to continuing to grow my portfolio. But from what I see, equity split is based on capital contribution. This method seems to limit any fair equity split for being a deal finder and/or doing any of the hands on work or coordinating value add projects. So my question is, am I understanding this partnering criteria correctly? Are there ways to fairly compensate for non-capital contributions? Lastly, as for property management, can we self manage? Is she allowed to hire me as the property manager or will we need to outsource?
As always I appreciate the help/guidance from the BP community! Always an invaluable resource!
