Real estate in retiremant plans

If I wanted to put a single piece of rental real estate into a retirement plan which qualified accounts would take it and can you be specific?



For the most part, you would be limited to an IRA account held by a self directed IRA custodian. It might be possible to put together a solo K retirement account to hold the property if you are self employed in a non real estate occupation, but don’t know for sure if you can find a custodian that would accept it.



It doesn’t work to “put a piece of real estate” in a retirement plan. The plan would have to buy the property from an unrelated person or you could have a prohibited transaction. You can only make IRA contributions in cash so you couldn’t get real estate into an IRA by transferring property. An IRA can accept a rollover of real estate from a qualified plan though.

There are possible problems with unrelated business income tax or other types of prohibited transaction thar arise from the managment or use of the real estate. You need a good custodian and a lot of good advice before choosing this type of retirment plan investment.



If i were to buy properties and sell a couple of them a year,would this qualify as self-employment activity in respect to having and maintaining a solo 401k ?



Is there an IRS Publication that lists the “prohibited transactions” when holding real estate in a ROTH?



Here is some info. Real estate is discussed on p 14 of this link:

http://www.aba.com/NR/rdonlyres/D8BE9599-E5ED-4994-91CB-BF8B23A2AE7C/429

The tax code section is 4975 and it applies regardless of IRA type:

http://www.taxalmanac.org/index.php/Internal_Revenue_Code:Sec._4975._Tax



Thank you Alan for the Singletary reference.



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