Investments for your retirement

Using your IRA investments to fund a purchase of a property is an excellent way to preserve your retirement while diversifying your assets.

Buying Real Estate With Your IRA

Did you know your IRA can purchase real estate? Since 1975, IRAs and 401(k) plans have been afforded the ability to purchase real estate,helping knowledgeable investors see significant change in their retirement wealth.

By establishing self-directed IRA, clients can combine their knowledge and expertise of the real estate market with the tax advantaged growth of their retirement plan, creating the ultimate wealth building machine.

  • Single Family and Multi-Unit Homes
  • Apartment Buildings
  • Co-ops
  • Condominiums
  • Commercial Property
  • Improved or unimproved land

In order to maintain the tax advantaged status of the IRA, clients must adhere to IRS rules on prohibited transactions and disqualified persons.

Funding the Purchase

Cash In this scenario the IRA pays cash for the entire property. The property is titled to the IRA and all income and expenses must flow through the IRA.

Partnering IRAs can purchase fractional ownership in property. Ownership interest is determined on the pro-rata amount of the investment purchased by the IRA. All income and expense must flow  through the IRA in the same rate basis.

Financing An IRA can purchase real estate with a  mortgage as long as the loan is non-recourse, which means there is no  personal guarantee to repay the debt by the IRA owner, or other  disqualified persons. Repayment of the underlying debt must come from  the retirement plan. Taking on debt in the IRA may subject the plan to  Unrelated Debt Financed Income.

5 Easy Steps to Buying Real Estate in your IRA

  1. Setup your Self-Directed IRA.. WE can show you how
  2. Identify the investment property for your IRA to purchase
  3. Send Custodian’s Buy Direction Letter & Contract
  4. Read & Approve closing documents
  5. Upon your approval, Custodian will execute closing documents and send funds to closing
Your IRA now owns the property. It's that easy!
Call Ed At 630-440-5805 for all the forms

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