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Call (916) 436-3776Self-Directed IRA Investing California
How Do I Buy Real Estate With a Self-Directed IRA in California?
A self-directed IRA can buy California real estate as a retirement investment. The IRA, not you personally, holds title, all income and expenses flow through the IRA custodian, and you and other disqualified persons can't live in, work on, or personally benefit from the property. If you finance it, IRS rules require a non-recourse loan (secured only by the property, no personal guarantee). Rental income and gains grow tax-advantaged, though debt-financed income may trigger UBIT. Done carefully, it's a powerful way to hold real estate in retirement.
A self-directed IRA (SDIRA) lets you invest your retirement funds in real estate, rental homes, commercial property, land, instead of only stocks and funds. Done right, rental income and gains grow inside the IRA's tax-advantaged wrapper. But the rules are strict: the IRA (not you) owns the property, everything runs at arm's length, you can't use or work on it, and any debt must come from a non-recourse loan. A single prohibited transaction can disqualify the whole account. This guide explains how it works, then links to a guide for your area. Serve First finds the property, Ashlar Lending arranges the non-recourse loan, and Ashlar LDA can prepare your checkbook-LLC paperwork, while your custodian and tax advisor handle the tax and compliance calls.
One family. Three roles in your IRA deal.
The property, the non-recourse loan, and the entity
Buying real estate inside a self-directed IRA has distinct pieces, and the Ashlar Brands family can handle three of them:
- 1.Serve First Realty, finds and helps your IRA acquire (or later sell) the investment property at arm’s length, with all activity in the IRA’s name.
- 2.Ashlar Lending Inc. (NMLS #2699657), can arrange the non-recourse loan that IRA rules require when you finance with debt: the loan is secured only by the property, with no personal guarantee.
- 3.Ashlar LDA, Inc., a bonded and registered Legal Document Assistant, can prepare the formation documents for a “checkbook” LLC that many investors use for control, at your direction.
Important: self-directed IRA rules are strict, and a single prohibited transaction can disqualify your entire IRA. Tax questions: UBIT/UDFI on debt-financed income, whether something is a prohibited transaction, disqualified persons, should be reviewed with your IRA custodian and a qualified tax advisor. Ashlar Lending handles the financing, Serve First the property, and Ashlar LDA the entity paperwork; none of them is a tax advisor. A Legal Document Assistant prepares documents at your direction and is not a substitute for an attorney.
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