Hey Mark! Great video. I have a question. What kind of rental property is it best to buy in your IRA as opposed to buying in your name? For example, would it be best to buy single family homes in low income areas in your IRA to reduce cost and 4plexes in higher income areas in your own name so that you can maximize the depreciation tax benefits you can get? Thank you.
I agree everyone's situation is different and not one way is better than another. Question #1: How does real estate work in Qualified accounts for beneficiaries? Or, if I happen to change my mind many years later and I want to give or sell one of the properties to my children or someone else that's considered a "disqualified person"? Question #2: What should one start with first? Fund an IRA for real estate or do real estate without an IRA? I'd be very skeptical that a typical middle class person would have to means to fund both (as you say, "balanced") their IRA/401k and still do traditional non-qualified real estate rentals.
Mark: Life insurance and annuities also enjoy asset protection in many states from lawsuits. My question is, why would you take an asset that is taxed at capital gains rates and put it into an account where distributions are taxed at ordinary income tax rates? In my experience, when IRA's are inherited, they are cashed in. Real estate is not the most liquid asset and as RMD's rise the requirement may exceed the income generated by the asset. Your thoughts?
Thank you for breaking this down so eloquently Mark! And very good point regarding "naysayers" about real estate inside of tax-deferred accounts and the fact that you lose depreciation. This comes up frequently to me as well. They are comparing apples and oranges. it's a moot point! Depreciation is used to offset taxable income, but inside of an IRA or Solo 401k the income is sheltered (or tax free in case of a Roth).
Love the PASSION Mark! I have a couple of dormant 401Ks that I was considering moving to a self directed IRA to invest in real estate. You mention that the IRA is a protected asset so does that mean I don't have to put it under an LLC? Your vids are awesome by the way. Learning alot. Thanks!!
Yes, the IRA is protected from you getting into a lawsuit. But the LLC protects you from the investments of your IRA of which you would be personally liable. Also, the LLC gives you the flexibility of control and not having to work with the IRA administrator saving you time and money in the long run.
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Hey Mark! Great video. I have a question. What kind of rental property is it best to buy in your IRA as opposed to buying in your name? For example, would it be best to buy single family homes in low income areas in your IRA to reduce cost and 4plexes in higher income areas in your own name so that you can maximize the depreciation tax benefits you can get? Thank you.
I agree everyone's situation is different and not one way is better than another. Question #1: How does real estate work in Qualified accounts for beneficiaries? Or, if I happen to change my mind many years later and I want to give or sell one of the properties to my children or someone else that's considered a "disqualified person"? Question #2: What should one start with first? Fund an IRA for real estate or do real estate without an IRA? I'd be very skeptical that a typical middle class person would have to means to fund both (as you say, "balanced") their IRA/401k and still do traditional non-qualified real estate rentals.
I appreciate your rant. I need help.
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Mark: Life insurance and annuities also enjoy asset protection in many states from lawsuits. My question is, why would you take an asset that is taxed at capital gains rates and put it into an account where distributions are taxed at ordinary income tax rates? In my experience, when IRA's are inherited, they are cashed in. Real estate is not the most liquid asset and as RMD's rise the requirement may exceed the income generated by the asset. Your thoughts?
Great question! Email me and let's talk about it more. mark@markjkohler.com
Thank you for the great contents. This vid has answered questions i’ve had for a long time.
Thanks! That's kind of you. :) mjk
Thanks so much for watching and supporting my channel! There are new videos coming out every week!
Great one Mark! This will be another hit!
Thank you for breaking this down so eloquently Mark! And very good point regarding "naysayers" about real estate inside of tax-deferred accounts and the fact that you lose depreciation. This comes up frequently to me as well. They are comparing apples and oranges. it's a moot point! Depreciation is used to offset taxable income, but inside of an IRA or Solo 401k the income is sheltered (or tax free in case of a Roth).
Love the PASSION Mark! I have a couple of dormant 401Ks that I was considering moving to a self directed IRA to invest in real estate. You mention that the IRA is a protected asset so does that mean I don't have to put it under an LLC? Your vids are awesome by the way. Learning alot. Thanks!!
Yes, the IRA is protected from you getting into a lawsuit. But the LLC protects you from the investments of your IRA of which you would be personally liable. Also, the LLC gives you the flexibility of control and not having to work with the IRA administrator saving you time and money in the long run.
LOL the most animated I have seen you. Enjoyed it! Thanks
I was a little upset about the topic. :) I probably should have toned it down a little. mjk
good advice, thanks! (FYI, irregardless is not a word)
Hahaha! I thought it was. Thanks for pointing that out!