#3 Personal Use Real Estate
Despite the belief of many people, you can actually have real estate as a direct asset inside an IRA plan. Yet, you must make sure that the IRA owner does not directly benefit from the property that has been named as an asset. This includes any income received from the property being rented or from the fact that the IRA owner is currently living inside the property. As a result, you cannot purchase your home with an IRA or any other retirement plan funds.
You can however hold real estate in your IRA as long as all the investments made are not made in your name and all expenses related to the real estate property you have and the income from it must be deposited and paid into the IRA. You will not be able to purchase your current primary residence or vacation home with your IRA (as it counts as a benefit, no matter how indirect).
You can also not buy or sell any types of properties that have been previously owned by you or any other person that is disqualified by the nature of familiar relations, which include your spouse, your children and their partners, neither parents, grandparents, or great-grandparents, along with grandchildren and even great-grandchildren!
A lot of IRA custodians will not facilitate direct ownership of real estate or even of interests that come from oil or gas assets you may have, but there are some who do. The drawback of that is that they will be charging you an administration fee each year that will be way higher than normal fees, so in the end, it can be a bad decision.
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