Generally, an IRA and a Roth IRA are tax sheltered funds that people use for investing for retirement.  Typically, these funds are given to a fund manager who invests the money in mutual funds, stocks, and other public investments. Skepticism has increased on Wallstreet with people like Madoff that have used accounting to steal money.  To have more control over the funds, some people use companies like Scottrade and E-trade so they can research and control what stocks to buy and sell.  A self directed IRA is an investment avenue controlled by the investor.  Examples of self directed IRA investments include tax lien certificates (Wyoming is the nearest state), rental property investments, and lending.

What is a Self-Directed IRA?

A self-directed IRA is an IRA fund that can be controlled by the owner with limitations.  People have used these IRA’s to invest in rental properties.  Because of the general nature of a Roth IRA (pay taxes going into the account, but pay no taxes on original investment plus gains), the tax benefit can be substantial especially over a period of time.

How to Learn to Invest in Real Estate with a Roth IRA.

As we are property management professionals and not financial or IRS professionals, it is imperative that you get the advice of the appropriate professional.  The following provide advice, information and holding for self directed IRAs: Equity Trust Company, Mountain West IRA, and The Entrust Group.  These are just a few examples of companies that can educate you on the rules and restrictions.