Buy Real Estate with a Self Directed IRA

Jun 5, 2023
Est. Read Time: 2 minutes
buy real estate with ira

Real estate has long been an attractive investment opportunity for many year. However, it is not always easy to find the funds to acquire a piece of property. Fortunately, with a Self Directed IRA, anyone can be a property owner. Above all, the returns can be significant if you’ve done your research!


A Self Directed IRA is similar to a classic brokerage firm IRA.

Self Directed IRAs possess the same legal structure, contribution limits, and tax advantages. Self Directed IRAs are really unique. They enable individual investors to leverage non-traditional (alternative) investments, such as real estateprivate lendinglife settlementsand so much more. You are in control and you are able to pick the investment that is right for you.

Investors choose Self Directed IRAs because they offer incredible flexibility and control.

Certainly control and flexibility is highly important in the realm of real estate investing. Self Directed IRAs are unique in that they make it possible to invest in what are known as “hard assets.” That makes a great solution for portfolio diversification.

The reason that most classic IRA providers do not offer the ability to purchase real estate is simple; banks and financial institutions that offer IRAs cannot profit from doing so. Classic brokerage firms typically generate revenue from transactions. Fortunately, IRA Club allows their clients to make investments in alternative assets like real estate. The payoff could be immense.

Let’s say investor Joan purchased a $100,000 rental property with her retirement funds.  A few years later Joan sold the property on for $300,000. The $200,000 of gain appreciation plus the monthly rents are both income-tax free.  If the property was purchased using personal resources (non-retirement funds), the gains would be subject to federal and state income tax.

Important Rules to Consider

There are a few important rules that must be followed when using a Self Directed IRA. Some of the most important rules to consider include “no self-dealing,” which means you cannot purchase a property and reside in it. Another important rule is no improvements via “sweat equity.” You personally cannot paint the walls. Just keep in mind that the property is being purchased for investment purposes.

In Conclusion

Buying real estate with a Self Directed IRA is growing in popularity but still underutilized by most investors. Investors looking to leverage their retirement accounts to invest in real estate should contact a qualified and knowledgeable team like IRA Club. If you’re interested in diversifying your investment portfolio and taking advantage of the tax benefits, contact IRA Club today.


For information about the Self Directed IRA or Solo 401k, call IRA Club at 312-795-0988

IRA Club offers no investments, products, or planning services. Therefore, please consult your attorney, tax professional, financial planner, and any other qualified person before making any investments.

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