Can a rental property be used as a Roth IRA investment?

 

   About a year ago, I found out I could invest my Roth IRA in more than
just mutual funds.  Previously, I always thought that mutual funds were
pretty much it for IRA investments.  Now I've got the $ in a couple of
safe, dividend paying stocks.

   Recently, I saw a bank owned rental property for sale at about 80% of
what I have in the IRA.  It got me wondering - could a person possibly
use the money in an IRA to buy a rental property, then use the rental
income to fund their IRA?

   I'm not sure how such a thing would work, or if it is even possible.
  Of course, last year I thought you couldn't invest an IRA directly
into favorite stocks, and I was wrong there.  I know I could easily take
the $ and invest in a REIT stock, which would be similar to what I'm
talking about.  However, it would also likely be much less profitable,
and I would have little or no control over anything that goes on with
the investment.

   My understanding is that there is a huge fine for early withdrawal of
IRA funds.  Not really sure how I could avoid that, since I'd need to
withdraw the funds in there to buy the place.

   Anyone have any ideas on this?  Thanks for your input.

 

In article none@none.net says...

The first place I go for any advice on complicated financial, legal, or  
relationship matters is here on Usenet.  

 

On Mon, 29 Sep 2008 05:24:58 -0500, Mark Anderson


Me too.  But to be safe I get a second opinion from my parrot.
Trust but verify.

--Vic

 


My cat gives me great advice on any subject I bring up.  Perhaps the
OP should consider getting a cat, too??

 

itsjoannotjoann@webtv.net wrote:

   I can help with that. How many free advice givers will you be
needing. Let me start you out with 4.

   Jeff