Discussion:Owning Real estate in a IRA
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| Revision as of 18:53, 3 January 2008 LH2004 (Talk | contribs) (It would be more) ← Previous diff |
Revision as of 02:04, 6 June 2009 Sheldon (Talk | contribs) (990-T with IRA Unrelated Debt-Financed Income) Next diff → |
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| {{ForumReplyPost|UserID=LH2004|Date=3 January 2008|Text=It would be more than that -- it would be a prohibited transaction, wouldn't it?}} | {{ForumReplyPost|UserID=LH2004|Date=3 January 2008|Text=It would be more than that -- it would be a prohibited transaction, wouldn't it?}} | ||
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| + | {{ForumReplyPost|UserID=Sheldon|Date=6 June 2009|Text=I just ran across a financial planner that put on a program to a group of realtors and I happened to find out about it so I went. I think it is an interesting field as many investors don't now want as much money in the stock market or bonds. They want some diversification into non-traditional types of investments. One of the presenters was an attorney from Provident Group or ProvidentIRA.com. They are a non-traditional type of IRA/401k/HSA custodian. I think we will see more and more of this as I have had clients and prospects come to me for this type of guidance since the market fell last year. | ||
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| + | I just went through the excersise of preparing a sample 990-T form with Schedule E and the "unrelated debt-financed income" calculation to make a proposal to an interested realtor that has already put some real estate into an IRA. The return itself is not terriby difficult once you gather all of the data. Losses go forward, but profit on the debt financed portion are taxable. I am interested in hearing other input from anyone preparing these kind of returns.}} | ||
Revision as of 02:04, 6 June 2009
Discussion Forum Index --> Tax Questions --> Owning Real estate in a IRA
| 4 February 2006 | |
| New to this page: I need to know all I can about owning Real estate in a IRA? What type of Trusts typically handle this. Banks, Stock brokers, etc. I'm aware that it must be investment property with no user benifits. | |
| 4 February 2006 | |
| How about just giving me a starting place for information on how to? | |
| 4 February 2006 | |
| You will need to find a individual willing to act as trustee, usually an attorney. The customer charge I have seen is 1% per annum. for this service. Banks and brokerage firm will usally not go near this. | |
| 4 February 2006 | |
| Can you buy the real estate property with the existing funds in the IRA? | |
| 4 February 2006 | |
| hi yes you can buy almost any investment in an IRA except collectibles. your biggest problem is finding a trustee who will let you. bye | |
| 4 February 2006 | |
| I received this e-mail the other day maybe this company can help??? I am not affiliated and make no recomendation.
HOW TO BUY REAL ESTATE IN IRAs & ROTH 401(k)s ATTEND FREE WEBINAR hosted by PENSCO Trust Company. Boomers are counting on you for more than just tax returns. Are you prepared to tackle their financial planning questions? Open up new markets for your practice with self-directed IRAs. Learn how to set up self-directed retirement accounts to invest in real estate, private placements, businesses, notes & more. | |
| 2 March 2006 | |
| Hello,
We use Pensco Trust to act as the trustee for our client's IRA's that invest in real estate. We have has no complaints with the company and the fees are very reasonable. | |
Mtmckeecpa (talk|edits) said: | 3 March 2006 |
| RBrothers,
Another administrator is Entrust. Check www.entrustfl.com. Full disclosure here: I sponsor seminars about self directing IRAs. It can be a good opportunity for those who want more control of their IRA. If you buy Real Estate and take on debt (nonrecourse) watch for the Unrelated Business Income Tax and filing form 990-T. Also, make certain that you don't invest in a prohibited transaction and or invest with a disqualified person. One of the better books I have read is IRA Wealth by Patrick Rice. This discusses generally and in some detail about self directing your IRA. Good Luck. | |
| 3 March 2006 | |
| Additional caveats include making sure there is enough cash flow within the IRA to allow for payment of property taxes, upkeep, etc and you don't run afoul of the contribution limits. Also, careful of the minimum distribution requirements and how you will fund those with (illiquid) real estate. Finally, the benefits of long term capital gain treatment on the appreciation of the real estate are lost as all IRA distributions are ordinary income. I don't recommend using and IRA to own real property. | |
| 3 January 2008 | |
| Pensco has popped up in my practice. What if the tax client buys land in a foreign country, with plans to subdivide it and build a residence on one lot. The residence may be initially leased as a rental property, and may become a family residence at some point. Would this not be a taxable distribution for any personal use? | |
| 3 January 2008 | |
| It would be more than that -- it would be a prohibited transaction, wouldn't it? | |
| 6 June 2009 | |
| I just ran across a financial planner that put on a program to a group of realtors and I happened to find out about it so I went. I think it is an interesting field as many investors don't now want as much money in the stock market or bonds. They want some diversification into non-traditional types of investments. One of the presenters was an attorney from Provident Group or ProvidentIRA.com. They are a non-traditional type of IRA/401k/HSA custodian. I think we will see more and more of this as I have had clients and prospects come to me for this type of guidance since the market fell last year.
I just went through the excersise of preparing a sample 990-T form with Schedule E and the "unrelated debt-financed income" calculation to make a proposal to an interested realtor that has already put some real estate into an IRA. The return itself is not terriby difficult once you gather all of the data. Losses go forward, but profit on the debt financed portion are taxable. I am interested in hearing other input from anyone preparing these kind of returns. | |
