[WSBARP] Using Self-Directed IRA for Real Estate Investing

[Eric Nelsen]

I don't know the answer, but that's only 99% worth of interests. Is the third member 2%?

Sincerely,

Eric

Eric C. Nelsen
SAYRE LAW OFFICES, PLLC
1320 University St
Seattle WA  98101-2837
phone 206-625-0092
fax 206-625-9040



From: wsbarp-bounces at lists.wsbarppt.com [mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of Rob Rowley
Sent: Thursday, November 20, 2014 3:16 PM
To: WSBA RPPT; WSBA RPPT Probate & Trust Discussion Forum
Subject: [WSBARP] Using Self-Directed IRA for Real Estate Investing

Would like to hear from counsel who has experience using a self-directed IRA for real estate investing. I am familiar with the great RPPT article from the summer and am using it.  Do have some prior experience with the practice in the context of ‘hard money loans’ with no ‘disqualified’ individuals but have a more of a technical question.

Using an LLC where there are three members and one of the members has a 49% interest, the second member has a 49% interest and a third member has a 1% interest.  All three members are unrelated.  Having one of the 49% interest members borrowing money from a lineal ancestor using a self-directed IRA..  Normally would be problematic because the borrower would be a “disqualified individual". 26 USC 4975(e)(2). The 49% rule from 26 USC 4975(e)(2)(G),

Thanks.


[cid:image001.jpg at 01D004D9.14006950]Robert R. Rowley | Attorney at Law
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Practice concentrated on business, real estate and general legal matters in Washington and Idaho.

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