The Self-Directed IRA and Solo 401k DifferencesIn order to open a solo 401k, self-employment, whether on a part-time or full-time basis, is required;To open a self-directed IRA, self-employment income is not required;In order to gain IRA checkbook control over the self-directed IRA funds, a limited liability company (IRA LLC)  must be utilized;The solo 401k allows for checkbook control from the onset;The solo 401k allows for personal loan known as a solo 401k loan;It is prohibited to borrow from your IRA;The Solo 401k may be invested in life insurance;The self-directed IRA may not be invested in life insurance;The solo 401k allow for high contribution amounts (for 2016, the solo 401k contribution limit is $53,000, whereas the self-directed IRA contribution limit is $5,500);The solo 401k business owner can serve as trustee of the solo 401k;The self-directed IRA participant/owner may not serve as trustee or custodian of her IRA; instead, a trust company or bank institution is required;When distributions commence from the solo 401k a mandatory 20% of federal taxes must be withheld from each distribution and submitted electronically to the IRS by the 15th of the month following the date of each distribution;Rollovers and/or transfers from IRAs or qualified plans (e.g., former employer 401k) to a solo 401k are not reported on Form 5498, but rather on Form 5500-EZ, but only if the air market value of the solo 401k exceeds $250K as of the end of the plan year (generally 12/31);When funds are rolled over or transferred from an IRA or 401k to a self-directed IRA, the amount deposited into the self-directed IRA is reported on Form 5498 by the receiving self-directed IRA custodian by May of the year following the rollover/transfer.Rollovers (provided the 60 day rollover window is satisfied) from an IRA to a Solo 401k or self-directed IRA are reported on lines 15a and 15b of Form 1040;Pre-tax IRA contributions on reported on line 32 of Form 1040;Pre-tax solo 401k contributions are reported on line 28 of Form 1040;Roth solo 401k funds are subject to RMDs;A Roth 401k may be transferred to a Roth IRA (Note that from a planning perspective, it may be advantageous to transfer Roth Solo 401k funds to a Roth IRA before turning age 70 ½ in order to escape the Roth RMD requirement applicable to Roth 401k contributions including Roth Solo 401k contributions and earnings.)

@Linda Weygant yeah, I thought about that first, but that was nearly a year ago and here we are about to roll over another year.

The pref can roll over to the next year, or the next month, or accumulate and get paid out at sale.

You may want to consult with a CPA and see if you can roll over the one time costs into next year if you converted it over late in 2022 - say November or December.  

Hi James, good subject, I did this awhile back, i ask my bank for a line of credit on two properties  , mortgage free, and 50% equity on my primary house, but since I have not been working I couldnt get it line of credit aproved, i do have a 401k and thinking in roll over to a self direct ira, but can i use that instead to build a triplex in one of my properties .

Why not buy something to start, then roll over you equity into a multi? 

(Assuming you're under 50 years of age)Roth IRAIncome (AGI) limit: $101,000 (Single)Contribution limit: $5000Funded with AFTER-TAX dollars (therefore, no tax deduction)No UBIT liability.Traditional IRANo income limitContribution limit: $5000 Funded with PRE-TAX dollars (tax deduction allowed)If Self-Directed, you are still eligible for UBIT.If Self-Directed, no UBIT liability.Solo 401(k)No income limit.Contribution limit: $15,500 plus 20% of your AGI (25% if you're incorporated) up to $46,000Tax deduction allowedIf Self-Directed, you can rollover you (non-Roth) IRAs and Solo 401(k)s into one giant SD-401(k)Like the SD-Roth IRA, no UBIT liability.Solo Roth 401(k)No income limit.Contribution limit: $15,500No tax deduction(Not sure about UBIT liability when Self-Directed)

He has a large amount in rollovers and IRA's.

Then you can roll over the funds into a solo 401(k) plan or IRA that allows "alternative" investments. 

You have to take advantage of the current run up in property values, all the incredible new demand for Commercial and Residential construction in Tampa and get ready for the roll over and slow down in the Real Estate Cycle.