Your IRA can buy real estate using its own cash and a loan/mortgage to acquire the property. Whenever you leverage your IRA with debt, however, you must be aware of two things. First, the loan your IRA obtains must be a non-recourse loan. And second, your IRA may be subject to a tax known as unrelated debt financed income tax (UDFI/UBIT). This comprehensive webinar explains the non-recourse loan requirements, as well as the non-recourse loan options and goes into detail on how UDFI tax may be applied and how it is calculated. Below are the slides from the presentation as well as the recorded video presentation of the webinar. Note that page 27 in the pdf slides below was up-dated from the webinar as I made a calculation mistake on the debt owed. The final tax numbers were still correct though. Thanks to Roger St.Pierre, Sr. VP at First Western Federal Savings Bank for co-presenting the topic with me.

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Comprehensive Webinar: Buying Real Estate with Your IRA and a Non-Recourse Loan Mat Sorensen from Mathew Sorensen on Vimeo.

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