Liability investing in RE w IRA funds through LLC - Posted by JOHN K HASLACH, CPA, MST

Real Estate Investing Real Estate Financing
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Posted by John K Haslach, CPA, MST on April 07, 2004 at 18:24:01:

Thanks, Rich!

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Liability investing in RE w IRA funds through LLC - Posted by JOHN K HASLACH, CPA, MST

Posted by JOHN K HASLACH, CPA, MST on April 07, 2004 at 08:10:39:

Is there an attorney out there who can answer this? I have seen large pensions invest in real estate through an LLC. Does the LLC provide liability protection to the assets of the IRA?

Thanks
John K Haslach, CPA, MST

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Re: Liability investing in RE w IRA - Posted by William Bronchick

Posted by William Bronchick on April 11, 2004 at 12:31:52:

In theory, it should, since an LLC is a liability shield. However, there is another dilemma… in order to claim the LLC is not merely a shell for the IRA, one must show a valid business purpose of the LLC. However, by the same token, the IRA itself would be engaging in business activity, thus possibly triggering the UBIT issue. Of course, the liability argument would be in state court, while the UBIT issue would come up in a federal forum, ie, an audit.

This is an evolving area of the law, so it will be a “wait and see” as the issues get litigated.

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RE: Investing in RE w IRA funds through LLC - Posted by Rich[FL]

Posted by Rich[FL] on April 07, 2004 at 12:17:13:

John, contact Ernest Tew (www.ernesttew.com, ernesttes@aol.com) for more information on this. He has a lot of god information on how to do this safely and successfuly.

Hope this helps,

Rich