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Self directed IRA’s with land trusts

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This topic contains 7 replies, has 0 voices, and was last updated by Avatar of buzzbox buzzbox 12 years, 2 months ago.

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  • #4328
    Avatar of buzzbox
    buzzbox
    Participant

    Has anyone had experience with using a self directed IRA as the IB, or know how it can be done?

    #24181
    Avatar of dkrueger
    dkrueger
    Member

    I plan to look into this further myself here in the near future. I was given a highly recommended resource for this from a well known investor/speaker. You can go to: http://destinyfundingllc.com, or call 877-800-DEST (3378).

    #24182
    Avatar of rick
    rick
    Participant

    You can go to: http://www.pencsotrust.com and press the Education button on the left. Then press the Resources button on the top of the page and look at the bottom of the page were you will find Web & Audio archives. Press that button and type in your Name and Email.

    A great source for learning how to use your IRA.

    #24183
    Avatar of buzzbox
    buzzbox
    Participant

    Thanks for the input.

    I’ve read what I can find. The crux of the matter, or question it seems, is whether a Self Directed IRA can be a beneficiary of a trust, that is a land trust and hence become an IB?

    I was hoping someone has worked through that issue and had the answer.
    The IRS (see Pensco site) excluded list of investments doesn’t mention trusts so presumably they would be allowable.

    Anymore thoughts would be appreciated.

    #24184
    Avatar of peter@amakya
    peter@amakya
    Member

    Your IRA or Roth IRA (a better bet) can be a the investor beneficiary.

    This is the basic way you do it. The Trust takes the option for a nominal amount, say one hundred dollars. When you find the Resident, the IRA become the investor. When the Resident or A N Other buys the house out of the trust the money goes directly to the IRA, in the case of a ROTH, tax free.

    You may want to build in some money for yourself in the contracts to afford you monthly cash flow or a lump sum at the effluction of the trust.

    #24185
    Avatar of vtolentino
    vtolentino
    Member

    @peter@amakya wrote:

    Your IRA or Roth IRA (a better bet) can be a the investor beneficiary.

    This is the basic way you do it. The Trust takes the option for a nominal amount, say one hundred dollars. When you find the Resident, the IRA become the investor. When the Resident or A N Other buys the house out of the trust the money goes directly to the IRA, in the case of a ROTH, tax free.

    Does the IRA have to be the IB outright? Or can I be the IB until the trust arrangement is all set-up, and then assign my beneficial interest from myself to the IRA?

    Thanks!

    #24186
    Avatar of peter@amakya
    peter@amakya
    Member

    No, no self dealing, you will go to goal as that is regarded as FRAUD or that’s how I read the rules.

    Just do it right up front and you will have no trouble. Set up in the paperwork, in the trust, to give you the versatility you require. Do not try an alter a simple formula with a whole lot of kinks. Do the it right first time (as Scott says) and when you learn al the nuances you will be able to do what you want as long as it is within the law.

    Pick the fruit at your height, not too high or too low.

    #24187
    Avatar of buzzbox
    buzzbox
    Participant

    Thanks Peter,

    That helps a lot.

    Now, to make sure that I do understand. In order to avoid the taint of dealing with a disqualified person, under the self directed IRA rules, in this case myself, and even though I am the person who assembled the deal and will be using my own personal IRA as the IB, as long as the land trust is already in place, and the property already conveyed into the trust before the IB enters the picture, I’m on solid ground – right? Or could the property be conveyed later?

    Now, if I want to hold any sort of participation, deferred or otherwise while using the IRA as the IB, am I not going to disqualifying the transaction because I’m a disqualified person?

    #24188
    Avatar of tom
    tom
    Member

    The use of a self directed IRA is very common with the trust program. As Trustee we have numerous beneficiaries in trusts around the country using the self directed IRA???s along with Roth IRA???s

    I suggest you contact one of the trust companies and speak directly with them regarding your questions. Information coming from anyone other then them will eventually need to be posed to them to be sure it is accurate.

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