IRA Partner in realstate
I am buying a $300,000.00 investment rental. I wish to have my IRA be my partner.
I will but down $100,000.00 and take out a $50,000.00 loan,
My IRA will but down $150,000.00
We (my IRA and I personally ) will share all profits 50/50 and all expenses 50/50
I will be able to take 50% of the tax deductions allowed to me personally but I know my IRA can not.
My IRA will have enough working funds in the account after the $150,000.00 for insurance , taxes , Maintains etc.
I believe this can be done. please give me your advise and knowledge in this matter.
thank you in advance for time and I look forward to working with you
Rikki Saunders
Permalink Submitted by Alan Spross on Thu, 2011-03-24 18:55
This is a strategy that is loaded with risks resulting from the prohibited transaction rules and relationship of your IRA and disqualified persons with respect to your IRA. There are only a few custodians who handle real estate investments in an IRA and you need to discuss this thoroughly with one of them and do plenty of research so your understand the extreme costs should the IRS disqualify your IRA.
Some of these firms include Guidant, Pensco and Entrust. You can check their websites for useful information on the subject.
Here is a general article on the subject of alternative IRA investments and some of the pitfalls.
http://www.aba.com/NR/rdonlyres/D8BE9599-E5ED-4994-91CB-BF8B23A2AE7C/429…