Self Directed IRA

An Individual Retirement Account (IRA) is designed to help you save for retirement while offering tax advantages and protection for your assets. A Self-Directed IRA (SDIRA) expands your investment options beyond traditional stocks and bonds, giving you the ability to invest directly in alternative assets such as real estate.

 

Benefits of Real Estate Investing with a Self-Directed IRA

  • Diversification & Stability – Real estate often provides more stability compared to the volatility of stocks and other securities.

  • Flexible Purchase Options – Properties may be purchased with all cash, through non-recourse financing (leveraging), or by partnering with another investor, trust, or partnership.

  • Asset Protection – SDIRA loans are non-recourse, meaning your personal assets are not at risk in the event of default or foreclosure.

  • Growth Potential – Investors can benefit from property appreciation while also generating cash flow through rental income.

The Process: Purchasing Real Estate with an SDIRA 

  1. Identify a Property – Work with a qualified REALTOR® to locate a property suitable for your SDIRA.

  2. Offer & Purchase Agreement – Your REALTOR® drafts the purchase agreement in the name of the SDIRA and submits it to your custodian.

  3. Custodian Review – The SDIRA custodian must approve and sign the agreement. You cannot sign personally.

  4. Funding – With your authorization, the custodian releases funds for the purchase.

  5. Closing – The custodian signs closing documents on behalf of your SDIRA. Title is held in the name of the IRA, not the individual.

  6. Property Management – All rental income and property-related expenses are handled entirely within the SDIRA. You direct the strategy, but payments and deposits flow through the account.

 

Key Regulations & Restrictions

You may purchase real estate from, or lease to, almost anyone except “disqualified persons,” which include:

  • Your spouse.

  • Your children, grandchildren, and their spouses.

  • Your parents, grandparents, and great-grandparents.

  • Any fiduciary of the IRA.

  • Any company, trust, or partnership where a disqualified person owns 50% or more interest.

  • Service providers to the IRA (and their families).

Note: Siblings are not considered disqualified persons. When in doubt, consult your custodian to confirm eligibility.

 

Professional Guidance

A Self-Directed IRA can be a powerful tool for retirement wealth-building, but strict IRS rules apply. Always seek advice from:

  • A certified accountant – for tax implications.

  • An SDIRA custodian or administrator – for compliance and account management.

  • An experienced REALTOR® – for sourcing and evaluating properties that align with your goals.

⚠️ Important Reminder: Regulations and tax laws may change. Before making any investment decision, consult with qualified professionals to ensure compliance and to understand how an SDIRA strategy may benefit your retirement plan.