@Derrick StropeI think you may be misunderstanding the 50% guideline.

While in casual conversation we can refer to the capital investment as principal or 'investor' principal or investment principal or capital sometimes not having a qualifier before the word can create confusion or misunderstanding.

@Shannon WebbDon't misunderstand...the 14% is annualized so you're paying just over 1% for every month you are using the money.

While it may not strictly be a prohibited transaction (like your IRA making a loan to you would be), it violates the guideline that your IRA cannot engage in any transaction that creates a benefit for you.Perhaps I misunderstand what you're proposing.

Doing that adds complexity and significant possibilities for misunderstandings later on.

- I just wasn't clear on that - there does not appear to be a lot of meat on that bone, did I misunderstand?

This reduces misunderstandings and makes things go much smoother.

Establish points in the timeline where goals are set and if met, a bonus will be paid.Establishing a timeline is a terrific idea for both of you to avoid any disagreements and misunderstandings.

This is without appreciation or debt service being countedElizabeth Colegrove - surely I'm misunderstanding you.

Twice today I've seen posts that demonstrate a gross misunderstanding of the 50% rule, so I thought it would behoove me to start yet another thread explaining this concept to my fellow knowledge-seekers.The misconception I've seen is encapsulated in a statement similar to:"I'm working on a deal that meets the 50% rule . . ."