How do I Fund my Real Estate IRA Account?There are several ways to approach investing in real estate with your retirement funds. Here are a few examples:
Direct PurchaseA direct investment involves purchasing a physical property and collecting the income generated within your self-directed retirement account. It is the simplest and quickest way to use liquid assets in your retirement account. Your IRA pays cash for the investment property and holds title to the property. Rules about prohibited transactions apply to direct real estate investments. Please make sure you understand these rules to avoid potentially significant tax penalties. Read about Real Estate Prohibited Transactions.
Partnering IRAsYou can partner your IRA with personal funds or other IRA funds. You can also partner with other people’s IRAs or their personal funds. You divide the investment according to each investor’s contribution. This will also split the profits and expenses for the investment, with each investor securing a percentage of the expense or return.
Learn more about Partnering an IRA
LeveragingYour IRA borrows money to purchase a property with a non-recourse loan and the leveraged property is held in your IRA. This sort of credit cannot be obtained by going through traditional means. Entrust works with many non-recourse lenders.
Learn more about Non-Recourse Loans
LLCA limited liability company, or LLC, is an entity often formed and used to purchase real estate in an individual’s IRA using IRA assets as a funding source. The IRA holds an interest in an LLC. The title of the property is held in the name of the LLC.
Learn more about Real Estate in an IRA LLC