All Forum Posts by: Ron Burmeister

I currently have a ROBS 401k structured C-corporation in which I am the only employee. I would like to be able to move funds from my 401k to my IRA. However, my current 401k setup does not allow me to transfer funds out of the plan. What solutions are there for me? Can I change to a solo 401k etc.?

Thanks

Jeffrey,

Cast Iron Insurance in Florence, KY can help you.  Contact Glenn Bailey at 859-743-6685. I am looking at doing the same thing with him.  

Good Luck!

Ron Burmeister

Nathan,

Good Luck.  You cannot get a better education that here!  If you ever need anything, feel free to reach out.

Ron Burmeister

Brett, 

I am a real estate agent, investor, and private lender in Northern Kentucky. I understand your dilemma and I am finding no deals at all for my account. The market seems so overpriced at this time.  To answer your questions:

1. I generally wave the inspections and appraisals if I can view the property ahead of time. Generally I feel comfortable in my ability to look at a property and tell if there are areas that make me uncomfortable. If so, I will either put an inspection contingency in or move on. For the appraisal, I feel i can do one myself. In essence I feel that a CMA is a good as an appraisal. So, I generally waive both.

2.  I think your premise within this question is where a lot of Real Estate agents go wrong.  It is not the job of an agent to "prevent" your client from making, what you think, is a bad deal.  Its the agents job to point out the risks and help the client make a decision.  If they decide to move forward, then its the agents job to help.  I have seen deals that I would not touch with a ten foot pole and ended up making $50,000!  You never know.

3. It seems the banks and investors believe they don't have to complete the property disclosure. In my opinion I believe this is against the regulations and the excuse that "I never lived in the Property" is bogus.  They know some things.  I wish KREC would crack down on this, but I guess they need a complaint to do anything. To answer your question, i rely on my inspections when making an offer.  It would be nice to have this information, but it does not stop me.  However, I am more cautious when I do not have a disclosure.  Caution is the name of the game.  

Hope this helps!
 
  

@Patrick Clark         Garth Kukla is a reputable guy. He is very active in the local community. 

I can recommend First Financial as well. I have 5 business checking accounts with them now. Their online banking setup is great! 

I agree, stay away from 5/3.

Thanks to @Brian Eastman@Brian Eastman and @George Blower for your feedback!

Brian, you stated:

"If you had such a structure [ROBS] in place and there was business owned property, you could not personally rent that property for residential use."

And George, You stated:

"As with any ROBS business, you can't use the business to personally benefit you. For a ROBS C-corporation that is operating as a real estate operating company, this means that the real estate owned by the ROBS-funded C-corporation certainly can't be leased to you personally(or another business that you own)for personal (or business) use. Moreover, you can't loan money to the C-corporation."

Again, thanks for your feedback. I am trying to find the guidance material on self dealing/prohibited transaction limitations for a ROBS.  You both gave examples of what you believe are Self Dealing/prohibited transactions.  However, can you provide support for your guidance? Where in the tax code, or other code, does it spell out the limitations?

I am sure that if I asked; where in the tax code does it spell out limitations on a SIDRA self dealing/prohibited transaction guidance?  I am sure I would get chapter and paragraph numbers.  However, no one has ever been able to direct me to the guidance on prohibited transactions/self dealing in a ROBS setup.

Forgive me, I am one of those over analytical types that love to see the source material.   

What I have found is that it seems that the self dealing/prohibited transactions for a ROBS can occur during the setup of the structure.  However, it seems that after the company is setup and operating it functions as any other C-Corporation.

I would recommend Mat Sorensen with KKOS. I believe their costs are more in the range of $1500. There is a tremendous amount of free information on their website. They can guide you through the process of setting up the IRA/LLC.

Setting it up improperly in the beginning can have tremendous consequences later on. Your custodian may require your operating agreement to have been setup by an attorney.  Not really difficult, but you need to be careful and informed.

Kingdom Trust is a good custodian.  That is who I use.

Also, and IRA/LLC is primarily for a passive income situation. Ordinary income may be subject to UBIT tax which could be as much as 39%. And be careful of self-dealing.

Good Luck.

I am currently using both a ROBS 401K and SDIRA to invest in real estate.  I use the ROBS primarily for Fix & Flips and the SDIRA for Private Lending and Buy and Holds.

There is a lot of discussion concerning self dealing and prohibited transactions with a SDIRA and I believe I have a good understanding of them.  However, there is not much discussion about self dealing and prohibited transactions when it comes to the ROBS 401K.  

My basic question is; Are there any self dealing or prohibited transactions issues with a ROBS 401K?  If so, what are they and where is the guidance located?

Can I personally (not my SDIRA) loan money to my ROBS 401K C-Corp?

Thanks in advance for your comments.

@Ramzi Nuseibeh and @Michael Seeker - compliance with KRS 383.580, actually 383.505 thru 383.705, is only required if your city or county has adopted the Uniform Residential Landlord and Tenant Act. Here is a link to the Kentucky Uniform Residential Landlord and Tenant Act, KRS 383.500 thru 383.715.  Most of the river cities have enacted the Act i.e. Covington, Newport etc.

Hope this helps.