The Self-directed IRA
Mortgage investments can be made from a self-directed IRA. To be able to make any kind of self-directed investment you need an IRA with a self-directed IRA custodian, through an industry leader such as Equity Trust.
IRA Plans with checkbook control
By far the best structure is a self-directed IRA Plan with "checkbook control", offered through an industry leader such as IRA Financial Group. Their low annual service fee also includes attorney support. IRA plans with checkbook control are easier to manage (no bureaucracies), and the annual cost is much lower (no transaction or processing fees). The setup expense is $1,000-$2,000, but well worth it. Highly recommended for $50,000+ IRAs!
Traditional IRA and Roth IRA
You can have two options with respect to when you pay your taxes:
1. Traditional IRA: The contributions are tax-deductible, but the eventual distributions are taxable.
Say you invest $100,000 over time, you will get $100,000 in tax deductions. If the IRA is worth $200,000 when you retire, you will pay tax over the $200,000 as you take the funds out.
2. Roth IRA: The contributions are not tax-deductible, but the eventual distributions are tax free.
Say you invest $100,000 over time, you will not get any tax deductions. If the IRA is worth say $200,000 when you retire, you will pay NO TAX over the $200,000 as you take the funds out.
LX investments and IRAs
The minimum participation in many of our investments is $20,000. This allows you to suit investment amounts to fit the available balance in your IRA. Many LX investors use IRAs. We are familiar with the practicalities. Reach out if you have any questions.
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