Self-Directed IRA With Owner Financing

For the past few years I’ve used my self-directed IRA to buy, flip and hold individual lots and never considered financing due to the non-recourse lender hurdles.



I’m interested in some raw land and the owner is willing to owner finance for 20% down. My question is this, if I have my IRA buy it do I need to do anything other than make certain I have enough in the IRA account to pay each month’s payment?

Comments(2)

  • finniganps28th February, 2008

    LT Cap gains rate is currently 15% for capital assets held > 1year (lower if your income is very low). Provide more info. and we can provide some additional info.

  • ypochris29th February, 2008

    Was the property purchased with the intent to hold or with the intent to flip? If they built a house, then sold it, the profit would be SE income and subject to SS/Medicare taxes as well as their regular tax bracket, potentially totalling over 50%. If they rented the property out this would indicate an intent to hold for the long term, and they would pay a maximum of 15% long term capital gains.

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