UNLEASHING THE FULL POWER OF YOUR IRA
Are you aware that you can invest funds from your IRA in real estate? Although this is perfectly legal under IRA rules, most stockbrokers and financial managers will tell you it is not. However, it does not come free from regulation.
You must use an intermediary who accepts your funds directly from their current investment house. The intermediary will then invest the money in your selected investment, one of which is real estate, or it can be an LLC, if set up correctly.
Tenants in Common
Some sophisticated investors, who meet the minimum net worth requirements, sell under the 1031 rules and roll through an intermediary to a real property investment called Tenants in Common (TIC). The investor purchases an undivided interest in a completed, or to be built, investment. This property is financed and comes with management in place. Advantages may be:
- Increased cash flow
- Access to higher-grade properties
- Exact dollar matching of TIC interest equal to cash available
Private Annuity
The tax code allows for individuals to put most types of windfall profits into private annuities, which either lessen the tax burden or defer it to some time in the future. Most private annuities allow for monthly or yearly income and various investment options. This option requires both accounting and legal counsel.
Note: All discussions regarding tax deferral are general in nature and competent professional advice should be sought prior to acting.
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