Your Retirement Savings Can Own Real Estate. Here's Exactly How It Works.
Yes, your IRA can invest in private real estate. With a self-directed IRA (SDIRA), your retirement account, not you personally, can invest in the L5 fund, run by L5 Legacy Capital of Frisco, Texas, in Texas and Louisiana real estate. Your custodian holds the asset, and distributions flow back into the IRA.
“Most of us don't have that money lying around. But what most of us have, especially if we're working, is a 401(k).” — Byron Kizzie
A private conversation with Byron Kizzie, our Managing Partner. No pitch. No pressure. Bring your custodian questions.
Is your retirement riding the same market as everything else?
For most people, it is. Your 401(k), IRA and brokerage rise and fall with public markets. A self-directed IRA can hold tangible, income-producing real estate with a defined business plan alongside stocks and funds you already own.
What is a self-directed IRA?
A traditional or Roth IRA held with a custodian that permits alternative assets like private real estate. Tax rules are identical to any IRA. If your current brokerage doesn't permit private placements, you open an SDIRA and roll funds over tax-free.
How does an SDIRA investment in the L5 fund work?
Six steps: the standard L5 process, adapted for your custodian.
Talk with Byron
A private conversation about the fund and your plan; if it fits, the private investor briefing follows.
Confirm custodian
Ask about review processes, fees and processing times for alternative real estate assets.
Verify accredited status
The fund is Rule 506(c). In general, an IRA qualifies through you as its accredited owner in InvestNext.
Sign in IRA's name
Titled as 'ABC Trust Company FBO Jane Smith IRA'. Custodian signs or approves the subscription.
Fund through custodian
Submit direction-of-investment; custodian wires funds. Funding takes ~90 days from first conversation.
Distributions to IRA
Income & proceeds paid directly to IRA to preserve tax-advantaged status. We provide year-end valuations.
What rules should I know before I invest my IRA?
Prohibited Transactions
You and disqualified persons cannot personally use the property or work on it for pay. A passive LP fund interest keeps this simple.
UBTI & UDFI
When debt finances real estate, part of IRA income can be UDFI. Ask your CPA how Form 990-T applies to your account before investing.
Liquidity & RMDs
The fund's target hold is 5 years. If taking required minimum distributions, plan to satisfy them from other liquid IRA assets.
Custodian Fees
Custodians charge setup, transaction and annual maintenance fees. Factor them into your net return calculations.
Put your retirement capital to work in real assets.
Custodian processing adds time, so investors who start early have the smoothest path into the fund. We coordinate the paperwork directly with your custodian.
A private conversation with Byron Kizzie, our Managing Partner. No pitch. No pressure.