Selling Commercial Real Estate held in an IRA
Can someone explain the inner workings of selling commercial real estate held in an IRA? If it is sold to a third party wouldn’t the cash from the buyer come into the IRA and the building be registered in the buyers name? Am I simplifying this too much?
Permalink Submitted by Alan - IRA critic on Mon, 2016-04-11 17:58
Same as a typical RE sale except that your IRA is the seller and your IRA must pay the commissions and other costs of sale. Your IRA receives the cash proceeds and the property is recorded under the buyer’s name at the close escrow. If you then no longer hold alternate investments in your IRA, you would no longer need a self directed IRA custodian. You cannot sell to a family member unless you first distributed the property from the IRA and reported the distribution on your taxes.