Self-Directed IRA LLC Investing Mistake to Avoid (Retirement Planning)

[@ClintCoons]

Would you like to learn more about this topic and talk to someone? Schedule a free consultation here: aba.link/uw6

[@SunniHorizons1]

I am binge watching all of your content. Thank you for making information like this available to the public.

[@ClintCoons]

Wow. Thanks

[@TAWNdidthat]

My 401k people don’t have knowledge of LLC funds coming out of my account. They really weren’t able to answer my questions about using funds from 401k. One said I could only use ROTH funds since I’m still employed, another said I wasn’t eligible to transfer funds to a SDIRA. Its tough when you’re getting mixed messages.

[@zehuazhou3390]

Could you please tell me how I would handle tax forms for this LLC? For example, when I open a business checking account that earns interest, the bank will generate a 1099 form against the federal tax EIN of that LLC. And my property manager will also issue me a 1099 for the rents collected for the real estate under this LLC. Can I just ignore those tax forms since the owner of the LLC is the IRA?

[@11Lenman]

Great stuff, Clint! If I use a SDIRA to purchase a rental, can I serve as the property manager?

[@ClintCoons]

Depends on the level of service you will provide as the PM. Possibly, but if you are rehabbing or doing more than just collecting rent and advertising, it may rise to the level of a PT.

[@icilahmb]

So your saying the two LLC’s I have, Wyoming (Holding Company) and TN need to be dissolved and when starting the SDIRA to get another LLC under the SDIRA?

[@ClintCoons]

A SDIRA owned LLC must be set up with the SDIRA as the original member. You can not move your existing LLC into your SDIRA.

[@zehuazhou3390]

Question regarding loans. If I use the funds that the IRA contributed to the LLC as down payment, can I borrow any non recourse commercial real estate loan? As I understand, the commercial RE loan will have the LLC as the borrower and me as the non recourse guarantor.

[@ClintCoons]

You can not guarantee the loan or your will commit a PT

[@zehuazhou3390]

@@ClintCoons Thank you. The commercial RE lender's loan doc says the following: Borrower XYZ LLC. Non-Recourse Guarantor: Lists my name there. Then it says it is non recourse to either borrower or guarantor except in standard Freddie Mac carve-outs. Could you please tell me if this make it a PT? Standard carve-outs include commtting a crime on the property, failing to pay property tax or insurance. Only in those conditions, will it become recourse.

[@utube9000]

Hi Clint - does all of this apply to LLCs owned by Solo401ks as well? Or are those a little different?

[@ClintCoons]

Yes.

[@felicia3760]

Thank you

[@ClintCoons]

felicia adair Thanks for watching.

[@rayo8065]

I'm two feet into setting up my own LLC IRA. I stepped on one of your no-no's. I set up the LLC in Alabama. Do not need to list owner, I'm organizer, and registered Agent and I used my credit card to create the LLC on line. I also applied for a single member LLC EIN. The next steps were purchase a IRA LLC operating agreement, and open a LLC bank account (which has min. Deposit to open). I addressed this with my custodian and was told my IRA would reimburse me from my IRA. Was that bad advice?

[@ClintCoons]

I think you may want to get a second opinion. Also the likelihood of audit is fairly small. Who is the custodian?

[@rayo8065]

@@ClintCoons Hi Clint, turns out this video is older and the McNulty vs commissioner ruled that you are not a disqualified person because the IRA has yet to invest anything. Preferred Trust is my custodian, they confirmed. It took me a bit, but finally have my LLC funded. Looking to invest with a guy I think you know, Troy Eckard. My only regret is I didn't set it up as a series LLC, but hard to find people in Alabama who know how or are interested in drafting a Series SDIRA LLC operating agreement. Eventually I settled with New Standard IRA Operating Agreement. I have the opportunity in Alabama to restate my LLC as series and may do so in the future.

[@davidsoneal]

To further understand the disqualified person protocol, can your LLC owned by your SD-IRA make a private investment in another LLC that is owned by someone (a brother) in your family?

[@ClintCoons]

Yes but you must make sure the person with whom you are investing is not a disqualified person.

[@xenxu26]

Good content. This takes my knowledge of SDIRAs in conjunction with LLCs to a new level, thank you. If an investor is buying properties utilizing an LLC holding company, should that holding company's bank account (cash) be held by another entity or trust? A video on strategies to protect your net cash reserves would be great.

[@ClintCoons]

I prefer to hold cash in a separate LLC.

[@HHCapitalGroupLLC]

HI Clint, How are you? We've spoke over the phone more than a year ago. My short-term rentals (a few properties with 2 managements) income has increased after I bought another duplex little over a year. I want to know if I should start getting a Roth IRA or a SDIRA with the LLC...which Anderson had created the Series LLC for me last year. What's the income range that's worth doing all these to get a SDIRA or should I just get a Roth IRA instead? I consider my income isn't very high yet.

[@ClintCoons]

Do you already have a ROTH or SDIRA? If so are you asking if you should look at using it to invest in real estate?

[@HHCapitalGroupLLC]

@@ClintCoons I don't have any but just wanted mainly to offset my taxes I'm paying to the IRS. Will SDIRA be too much for my case & I probably won't invest in RE anytime soon or much. I need to get back on track first as I've a lot to catch up for now.

[@ClintCoons]

@@HHCapitalGroupLLC Income generated from rental acitivty is no eligible for IRa contributions. You must have active income, e.g., W-2.

[@mariac9502]

Is an X husband a disqualified person? I want to loan money from SDIRA to XH,

[@ClintCoons]

no but is there a reason he is an X? 😄

[@mariac9502]

haha. well, he is a great guy and I trust him now more than anyone. @@ClintCoons

[@zeeski7454]

Are siblings prohibited from doing transactions with?

[@ClintCoons]

Correct. Siblings are not disqualified persons.

[@georgehirvela7435]

If I buy an investment property with my ira/llc and somewhere down the road want to buy it from the ira/llc and pay the taxes can that be done?

[@ClintCoons]

Possibly but you should get a revenue ruling before you do it or at a minimum make sure your IRA only holds the one property so if it gets flagged it is the only the real estate IRA that is blown. I know of this strategy working with a qualified retirement plan where the sponsor needs to create liquidity for the plan so his corporation bought the real estate at FMV from the plan. I am not aware of this strategy being used with an IRA.

[@georgehirvela7435]

@@ClintCoons My thought was to use the ira to buy an investment property and in a couple of years when I retire sell my house and move it to the investment property, putting off the tax burden till when I have that lower-income.

[@ClintCoons]

@@georgehirvela7435 You will take it as income when you dissolve the LLC and distribute the property to yourself. Depending on the value of the property this could push you into the highest tax bracket.

[@188jan]

I used common sense. So what you had said is the one I’m doing 😊

[@k.c.wingert7179]

Do you recommend any colleagues in Iowa who are competent and can help me set this up?

[@ClintCoons]

I do not have any but we can assist. If you would like a FREE 30-minute consultation, you can request one here - aba.link/30minSession

[@CindaMurphyRealEstate]

I had a 401k. After I quit, I rolled it into an IRA. Can I turn that into a Self Directed IRA now? I’m a realtor now and I want to invest all my money into RE instead of the stock market. A friend of mine says I can’t because that was from W-2 income and I am now self employed. Here’s what she said, “I hate to burst your bubble- but unless you can transfer over other self employed Ira funds into SDIRA, it’ll take you a long time to build up enough to purchase. You can contribute up to 100% of income up to 250k i think every year, but you can’t as you need to live on some, if not all your income. ☹️. I know this isn’t want you want to hear- but that’s the only way to fund a SDIRA. From other self employed Ira’s or ongoing from current self employment income. I couldn’t roll my regular IRA in it, only my SEPs & Simples. (Self employed Ira’s). “ True?

[@ClintCoons]

False. You can roll any IRA into a SDIRA.

[@CDReimer]

Can you own an apartment complex (5+ units) inside a SDIRA?

[@ClintCoons]

Yes

[@arth133]

Can I use my IRA LLC to invest in foreign countries' real estate?

[@ClintCoons]

Yes

[@igorsidelkovsky7944]

Very interesting video and good tips about how to avoid investing mistake, thanks for your time and useful video.

[@ClintCoons]

Igor Sidelkovsky Thanks for watching.

[@darrelpyle3659]

Could the LLC or IRA invest in a multifamily syndication as a key principal if they do not receive compensation and do not have management duties? However, potentially as a guarantor on a non-recourse loan.

[@ClintCoons]

Yes you can invest but you can not personally guarantee.

[@DanAtEXIT]

Good stuff

[@stacysays]

Can my daughter be the registered agent for my SDIRA? She will not be a "paid" RA. Also, can she be an additional manager of the LLC? ..... OR.... would that cause us BOTH to have to sign each check from the bank?

[@ClintCoons]

Stacy I think it is best if neither you nor your daughter serve as RA. Arguably you could but an aggressive agent might say you are providing services to your IRA and this could create a complication. I think the $150 a year you pay someone to serve as RA is money well spent. If your daughter is a manger with you then banks will typically require she be a signer on the LLC bank account.

[@jerrykid4972]

Good stuff mate. I’m currently just using my SD IRA for cryptocurrency. Soon will be adding real estate.

[@EnergyProX]

Same here!

[@gilsoto4142]

I’m , just wondering how exactly do I move my crypto back to Ira for withdrawal when it’s time.

[@temirraellis4304]

@@gilsoto4142 ever figure this out?

[@stephenmacknik3212]

I’m too new to this topic to understand your kind advice. Could you send me to some more remedial educational material so that I can understand this? For example, I don’t know what a self-directed IRA is and I didn’t know that an IRA can own real estate.

[@ClintCoons]

I have a channel on this topic but here is anther video: kzbin.info/www/bejne/Y6uxhqF5oLWjqKM

[@teresacurren1464]

@@ClintCoons Yes, I am new to this idea too. I will have a look at that video on the above link. If someone invests their IRA money in real estate like this, what happens if the person who you invested with, who buys the property and keeps it up, dies?

[@ClintCoons]

@@teresacurren1464 Their heirs will inherit the asset.

[@corythompson4709]

Do you recommend the LLC structure for crowd source real estate investing...such as with the Fundrise platform?

[@ClintCoons]

Yes but you would only need 1 LLC to hold your various interests.

[@minionsystems]

Question: I'm thinking about using a llc ira to invest in a nature reserve property in Costa Rica. Costa Rica has a mechanism to reimburse the owner in a couple of ways. 1. They will provide a payment to the owner called PES for NOT developing the property for ecological reasons. 2. They will provide the owner with a permanent visa if it is over a certain value. I assume the PES payment will go to the IRA via the LLC and that's ok but what about the visa?

[@ClintCoons]

Im not sure. This is out of my lane. I suggest you contact an attorney familiar with this type of transaction. Best of success.

[@chizzyike]

Clint, are you able to set up a self-directed IRA LLC for a client in Texas? I will be opening a company (an LLC) in healthcare, can the SDIRA invest in it and own shares? Thanks.

[@ClintCoons]

Yes. If you would like a FREE 30-minute consultation, you can request one here - aba.link/30minSession

[@zanderstone2898]

Great stuff I never even considered!

[@ClintCoons]

Zander Stone Thanks for watching.

[@carlosvera2807]

Is it possible to co-own a real estate property with the SDIRA and keep separate transactions when managing expenses and profits? Or is it a formula for disaster? Great content by the way

[@ClintCoons]

Yes you can JV with your SDIRA on a new purchase but you can not on existing property.

[@devanhcrow]

As of the time of my viewing this video, youtube shows me that there are 4,679 views. I do not understand why there isn't 4,679 likes on this video. This video is GOLD.

[@ClintCoons]

😀👍

[@cadiehl1]

Totally unnecessary.

[@steve-on3234]

Dude - your handwriting is crazy bad :). suggest you find a way to type to display on screen.

[@ClintCoons]

Sorry for that