By moving your IRA or 401k money to a self-directed IRA, you can hold real estate, tax deeds and many other items. I am only concerned with holding of Real Estate. There are many guidelines to go along with the many benefits.
Here is how it works;
First you choose a self directed IRA administrator like Mountain West IRA to move your money to. No penalties - you are not withdrawing, just rolling over. Next, you identify an income producing or investment property to purchase here in Park City, with me as your Buyer's agent. Vacant land can also be held by a self-directed IRA with the intent that this property will increase in value and someday make you some money. This property can be purchased in full by your self-directed IRA, or there are loans available for certain properties. The loans are non-recourse and are loaned to your IRA based on the income producing history of the property, not your personal credit or income.
Now, you can't buy that ski home for your personal use, the IRS does not allow that type of usage. However, you can buy that ski home or condo for your future financial security. In theory, this income producing property will hold its own and cover most expenses, and hopefully gain in equity as our market recovers. Of course, there is risk involved. If you had your IRA in the stock market and it falters, you are affected. If you have your IRA money in Real Estate and the market falters, you are affected. In both scenarios you are only affected if you need to sell while the market is experiencing a downturn.
There are so many scenarios to explore along with the rules and guidelines, I recommend calling a professional. This is a very simplified summary.
Are you in Park City on August 11th? John Galane of Mountain West IRA will be giving an 8 hour in-depth class about how to hold real estate in a self-directed IRA. See flyer below. I have represented a buyer using Mountain West IRA as their administrator of their sself-directed IRA, and the process was easy. Quite painless. I am happy to answer questions about how that transaction went and how we could find a property for you. Call me at 435-731-0803
