REAL ESTATE AS IRA INVESTMENT?
Many people with Individual Retirement Accounts may wonder if they can roll their IRAs into real estate. The answer is a very qualified “yes.” In a self-directed IRA, the IRS stipulates that investment property must be rented out at all times and not used as a personal residence or rented out occasionally. This rule prevents owners from taking otherwise normal real estate deductions such as property taxes, mortgage interest, and depreciation on personal tax returns. In addition, there is a host of other “prohibited transactions,” including the fact that the property is owned by the IRA and that the IRA must be held under the custody of a fiduciary firm. Side-stepping prohibited transactions risks loss of IRA tax-deferred status.
There are numerous facets to a real estate transaction. We will be there to guide you, step by step. Contact us today at CANNON REAL ESTATE, (413) 527-8311, to arrange an initial meeting at our office, 199 Northampton Street, Easthampton. Not all agents and agencies are the same. You will benefit from our extensive real estate experience and expertise. “Your local real estate professionals for over 30 years.”
HINT: Real estate purchased within an IRA cannot be rented to “disqualified persons” such as the IRA owner’s spouse, parents, children, and the children’s spouses.