All Forum Posts by: Sam Ricochet

@Loren Whitney 

Thank you. You actually answered my question and struck upon the 1031. I will research 1031 within IRA and see if that can avoid the UBIT as I am already investing in another property.

Thanks for your valuable feedback but I am specifically looking at either.

1. Filing the 990-T myself

2. Or get a recommendation from this forum on an experienced CPA who can fill this out.

I would not attempt to do it myself but I would appreciate if anyone can point me to a resource that explains the way to calculate the basis for UBIT for a real estate property. This would help me understand it so I can make better investment decisions next time by incorporating the trust rate into my P/L analysis. 

I might convert this to a solo 401k as it avoids the UBIT. 

My first post out here. Learnt a lot from just search and reading through. Great place to learn!. Thanks!

Here is my story:

Me : SDIRA(IraServices) --> My LLC(EIN 1)

Wife: SDIRA(IraServices) -->Wife LLC(EIN 2)

Bought a CA property to be developed in May 2013 for $400k with funds from both LLCs. 

Borrowed (non-recourse) for $350k in Aug 2014 for improvements.

Total Cost of improvements: $350k(borrowed)+$200k(LLCs) = $550k

Sold in Dec 2014 for $1.2m. 

Proceeds are in the LLC's bank accounts.

Both LLCs received 1099-S from Escrow agent. 

Now its time to file taxes and read that UBIT needs to be paid on the leveraged amount. Here are my questions

1. 1. Which one (LLC or the SDIRA) needs to file the 990-T? I understand its the SDIRA, How do I file and pay taxes? Does each SDIRA needs its own EIN? When it comes to payment does the LLC transfer monies back to SDIRA and then instruct the custodian(IraServices) to pay?
2. 2. How can I calculate the basis? Can I depreciate the property? How should I do that?
3. 3. How to calculate the leveraged portion based on the short time the money was borrowed?

Appreciate if anyone can shed some light on this. 

Finally I would love to know if anyone can recommend a CA Tax CPA in Bay Area who understands SDIRA and UBIT.