Real Estate IRA
Simple Real Estate IRA Rules
Using an IRA to invest in Real Estate is the #1 reason why people opened a Self Directed IRA.
The IRA Club is an experienced provider of Real Estate IRA accounts. For information on how a Real Estate IRA can work for you; Call The IRA Club toll free 888-795-7950.
How to decide if you should consider a Real Estate IRA
The money in your IRA is probably a critical part of your retirement planning. Due to the flexibility of a Self Directed IRA you may select the investments you believe are in your best interest. For example; if you believe investing in Real Estate offers the greater combination of return, appreciation and suitability than a Real Estate IRA may be a wise choice.
A Real Estate IRA Provides Tax Deferred or even Tax Free Growth
By buying Real Estate with your IRA dollars all rent income and all sale proceeds will be 100% tax deferred or tax free.
A Self Directed Real Estate IRA and Checkbook IRA can invest in any form of Real Estate including:
- Income Producing Property
- Undeveloped Land
- Agricultural Land
- Off Shore Real Estate
- Residential property
- Commercial property
- Industrial property
To help maximize your Self Directed Real Estate IRA returns consider starting a Checkbook IRA. Checkbook IRAs provide:
- Greater Speed
- Greater Ease of Use
- Lower annual Maintenance cost
- No Transaction Fees
Why consider a Checkbook IRA: A Checkbook IRA for your IRA Real Estate investments will give you:
- Instant Access to your IRA Funds: Take advantage of any real estate opportunity fast.
- Buy Real Estate at auctions. You can now snap up the best deals.
- No delays while a custodian reviews each document to decide if they will release funds.
- Ultra low administrative costs which can save you thousands over the life of the account.
- No cost per check
- Hold as many assets as you like in your IRA LLC, this will really let your account grow.
Why the IRA Club for your Real Estate IRA
- Professional Service
- Low Cost
- Work with a single source
7 reasons, why you should consider establishing a Self-Directed IRA:
1. Most IRA custodians and employer sponsored retirement plan restrict your choice of investments.
With a self-directed IRA, you can invest in exactly the opportunities you believe will help you reach your IRA goals.
2. Diversification is an important eliminate of any portfolio. Establishing a self-directed IRAs allows you to select from the widest possible array of opportunities.
3. Self Directed IRA may use leverage (borrowed money) to help buy Real Estate (this may cause a taxable event).
4. When an IRA borrows money to buy Real Estate that loan is non-recourse to you. i.e. only that asset and not you are responsible for the loan.
5. Your Self Directed IRA can buy and sell real estate with not tax able event, and not 1031 Exchange costs
6. Funding a Self Directed IRA from your current IRA or 401(k) is not a taxable event.
7. If you personally would like to live in the property owned by your Self Directed IRA your IRA can “Distribute” the property to you.
Yes, your Individual Retirement Account (IRA) may invest in Real Estate. The process is simple once you understand just a few rules.
If you believe that an investment in RE offers the right opportunity for you and your IRA, The IRA Club can help you get started with a Real Estate IRA. It only takes a simple phone call.
What Types of Real Estate is eligible for Investment using my IRA?
Almost any type of investment Real Estate may be owned inside an IRA. The most common type of Real Estate investment found in IRA accounts is income producing property (rental property). These include single family homes, two flats, four flats etc. In addition, many people use their IRA to hold farmland, timberland, and even mineral rights.
Is this a new idea?
We have all been allowed to own investment real estate in an IRA since January 1, 1975. Today we estimate that almost two million people have investment real estate using their Individual Retirement Account.
You and your IRA may not co-mingle
What belongs to you personally and what belongs to your IRA should be kept separate. Example, any costs for upkeep on the IRA owned property should be paid with IRA dollars (not by you personally). Just as all the rent or other income from the property goes directly to your IRA (and is all income tax deferred or even income tax free)
Will I need a Special Type of IRA to hold the Real Estate Investment?
Yes, you will need a Self Directed IRA. There are two types of Self Directed IRAs: Custodial Type and the Checkbook Type. For more information on which would be best for your needs contact The IRA Club 888-795-7950
Where will the new IRA get the money so it may buy the real estate?
The two most common ways to fund a Self Directed IRA account are:
- Transfer funds from your existing IRA
- Transfer funds form an old 401(k) or Pension Plan
Must I transfer 100% of my former IRA account?
No, just transfer the amount you want to transfer.
Is the Transfer from my old IRA or 401(k) a Taxable event?
No, Trustee to Trustee transfers are not a taxable event. For detail please consult an IRA professional such as The IRA Club 888-795-7950.
How long does it take to open a Self Directed IRA account?
Generally 21 to 28 days. This is important to know because your Self Directed IRA account must be in place prior to the transaction. Please allow adequate time.
Dose the IRA Club charge a percent of the amount my IRA invests or a part of the IRA’s earnings?
The IRA Club charges only a flat fee per account no matter the size of the account or the profits.
IRA Tax Types
Real Estate may be owned in any tax type of Self Directed IRA including:
Traditional IRA, Roth IRA, SEP IRA, SIMPLE IRA etc; In addition if you own a business (with no employees) you may also consider a Solo 401(K).
Tax Treatment of Earnings
All IRA accounts are income tax deferred, or may even be income tax free, there is no income tax on the earnings your money makes inside the IRA account. This allows your IRA account to grow and compound in size much quicker than if the earnings were made outside an IRA account.
How Many Houses may an IRA account own at the same time?
No Limit. It is not uncommon for a single IRA account to own many houses due to the compounding effect caused by the tax deferral status of the IRA account.
What is the Maximum Dollar value allowed in an IRA account ?
Are there any prohibitions when investing my IRA in Real Estate?
- The biggest one is simply that the IRA’s investments are for the exclusive benefit of your IRA. Hence, you or a family member may not receive a current benefit from the property.
- May my IRA buy a house, rent the house to a tenant, and earn income free from current income tax?
- May my IRA buy a house and I (or a family member) live in the house?
NO, because by living in the house you or your family would be receiving a current benefit. The investment must be for the exclusive benefit of the IRA.
- Don’t co-mingle of your personal assets and the IRA’s assets.
- You or a family member my not invest “labor” into the property. Sometimes this is referred to as “no sweat equity”. If work needs to be done on the property; simply call a local handyman or professional.
- For more information about restrictions, speak with an IRA professional such as The IRA Club 888-795-7950
Will My IRA be required to pay the new 3.8% tax on investment income?
No IRA accounts are exempt from the new Medicare tax 3.8%
There are two types of IRA accounts you may choose from. The Custodial IRA and the Checkbook IRA (sometimes called an IRA-LLC). A professional IRA Company like The IRA Club 888-795-7950 can provide information on the type that best suits your needs. In Addition The IRA Club offers a video on the topic which they will send to you at no cost . 888-795-7950
Want more information? Or do you want to know about a Checkbook IRA that can give you total check writing control? Call The IRA Club toll free 888-795-7950
For more information:
For easy reference just click on the term that you would like more information about and you will go directly to that page Real Estate IRA, Checkbook IRA, Self Directed IRA, Solo 401 (k), Tax Lien IRA, Family Checkbook IRA, Gold and Precious Metal IRA, and Self Employed IRA.