Buying a property with a self directed IRA

[DomoDomo]

Anyone have any experience with this in Argentina?

 

[PoorSoul]

You would lose any tax advantage of the IRA, so why do it?

 

[Ries]

I believe the OP is asking if the IRA can buy the property, not if they can cash in the IRA, pay the taxes, and buy the property.

I am not a tax attorney or a CPA, but a quick google tells you that the laws about buying property with self directed IRA's are pretty clear that you can do it, as long as you dont live in it, rent office space in it, vacation in it, or otherwise directly benefit from it beyond the rent or income going back into your IRA.

So- if its purely an investment, its possible. But if you plan on using it for living in, no.

I found this online, for example-
"Can your self-directed IRA purchase a vacation home for you to occasionally use? Can you rent office space for yourself in a building that your self-directed IRA owns?

No."

here is a guy who says its a good idea- http://www.escapeartist.com/blog/buying-foreign-real-estate-ira/

doing it legally is somewhat complicated, and will have transaction costs above and beyond a normal real estate purchase, and the income will be taxed at a relatively high rate.

 

[PoorSoul]

Yes, I knew what he meant. There just wouldn't be a point to do it. It would completely defeat all the tax advantage of the IRA

 

[DomoDomo]

The tax advantages stay the same as if the account held stocks and bonds. Transferring the funds to a self directed IRA allows me to buy a property with appreciated assets without paying the taxes to liquidate it first. Property appreciation, obviously, and rent payments go back (stay) in the self directed IRA and expense paid out of the self directed IRA. In my case, I think this stock run up in the USA is coming to an end. My question wasn't too clear, but as Ries correctly noted, my question is about titling the property (see below). Can a LLC purchase real estate property in Argentina? Thanks!

The IRA owner then, as manager of the LLC, signs the contract for the LLC to purchase the real estate. The property should close in the LLC name with funds from the LLC bank account and the LLC then in turn rents the property, receives the income and pays the expenses all from the LLC checking account.

 

[PoorSoul]

Your real estate and rent will still be taxed inside the IRA. They will just be taxed by Argentina. So, you will lose all benefits of tax-free growth.

 

[Addi]

Taxes in Argentina... I would suggest to talk to Tranio as they have more experience and knowledge about property in Argentina, taxes and so on.