Congratulations on requesting the full version of our Real Estate IRA Exposed Report – Please enjoy this report and contact us if you should have any questions.
Reason #7: Your Daughter/Son Needs a Place to Live
When investing in real estate with your IRA, it is important to know the rules. Under IRS rules, your son or daughter is a disqualified person which means that purchasing a home in your IRA for your children will lead to taxable consequences including disqualification of the remaining funds in your IRA.
Reason #6: You Need Cash and Your Bank Didn’t Approve Your Home Equity Request
While this may seem like a great idea, the fact is that you are a disqualified individual and are not permitted by the IRS to get current value from your IRA. This means that you cannot withdrawal funds from your IRA and use them for your own benefit prior to age 59 1/2. Doing so is considered a distribution by the IRS and that distribution will be subject to taxation and early withdrawal penalties.
Reason #5: The Value of Depreciation Out Weighs the Taxation Benefit
Many people purchase real estate within their IRA because of the amazing tax benefits. The profit from a real estate investment inside an IRA grows tax-free and/or tax-deferred depending on the account type. Another powerful benefit is that real estate within an IRA is not subject to Capital Gains taxes. At the same time, you cannot write off depreciation on real estate held within an IRA. Run the numbers and consult with your professionals to determine which option nets you the greatest profit.
Reason #4: You Want a Hands-Off Way to Build Your Retirement
The most successful Real Estate IRA investors are dedicated to their investments. They spend time prior to the purchase, during ownership, and after the sale to ensure their money is spent wisely. If you do not have the time to dedicate to doing your due diligence prior to purchase and to putting together the right team of professionals to manage your real estate asset, then investing in real estate in your IRA may not be for you.
Reason #3: You Need Cash in Your IRA
If you will be retiring soon and will need the cash in your IRA or need your IRA to carry a cash balance for other reasons, then do not buy real estate with that cash. Real estate, like any other asset, varies in value and may be hard to sell and turn into cash in a hurry especially in this current market. Consult with your professionals to determine which portion of your IRA should remain cash and which portion you can afford to purchase real estate with.
Reason #2: You’re Looking to Try Out Real Estate Investing
Our most successful clients invest in what they know and understand. Individuals who are inexperienced in real estate and yet determined to learn the ropes should carefully put together a team of professionals who can advise them along the way (CPAs, Attorneys, Real Estate Agents/Brokers, etc.). Another invaluable professional is a mentor who is an experienced successful Real Estate IRA investor. A great place to find a mentor is at your local real estate club. Learning from the mistakes of others is always cheaper than learning from your own mistakes.
Reason #1: You’re Looking to Get Rich Quick!
The goal of investing in real estate with your IRA is to build your retirement account for your future. Real estate investments can be lucrative and quickly add up in your retirement account. Our client David G. grew his account from $6,800 to $293,000 in 5 short years. Having said that, the IRA prohibits you from using those funds until you are age 59 1/2. So, if you are looking for a way to get rich now so you have money to spend now, then a Real Estate IRA is not for you.