Private Money Real Estate Investing

Please Note: This website is intended for educational purposes only!

Are you currently earning the return you want on your investment dollars? If not, you should be, and you can with private lending in real estate! Private money lending is a great alternative to the stock market, especially in these tough economic times.

Interested to find out how you can earn the returns you want, secured by real estate and insured? Click the link below and find out more about becoming a private money lender, and find out how you can build toward a fantastic retirement through private lending with real estate investments.

Learn more about private money real estate investing. Click here.

Why choose an IRA rollover?

Foremost, to avoid unnecessary taxation. When you become eligible for these benefits, you can access the money immediately, and pay tax penalties OR you can choose an IRA rollover. With the rollover option, your benefits are tax-exempt. And you will continue to grow these assets. Your retirement fund grows faster since it is not taxable and you are not required to report your yearly investment income or capital gains. If you want control of your retirement savings, a rollover takes the control from an employer plan and gives you the ability to make the decisions about your money. You decide when to take distributions, and how much to take. You might opt for a tax-free Roth instead of a Traditional IRA, changing the income in your retirement account. How you handle your account is up to you. With sound advice, careful planning, thoughtful management and smart investing your IRA Rollover can be a great asset that works for you. Remember, the transition should be simple and straightforward, but if you experience any difficulties you can seek technical advice from your tax advisor.

Learn more about your IRA rollover. Click here.

Roth Iras: Test your Knowledge

How well do you know Roth IRAs? Here are five tough questions. Let’s see how you do…

1. I am 72 years young and still working. Can I set up a Roth IRA?

Yes. Unlike a traditional IRA, which does not allow contributions past age 70 1/2, Roth IRAs have no age limitations. You can continue to contribute to your Roth as long as you have compensation.

2. I am married, age 57, file a joint tax return and make $65,000. I am a participant in a 401(k) plan at work and put $5,000 into my own traditional IRA. Can I set up a Roth IRA?

Not in the tax year in question. You already put your regular contribution limit ($4,000) into your traditional IRA along with another $1,000 catch-up contribution which is allowed because you are over age 50. In your case, you have made the maximum IRA contribution. If you put less into your traditional IRA, you could put the difference, up to $5,000, into a Roth IRA.

3. I am single and my modified adjusted gross income for 2006 was $115,000. I have an existing Roth IRA. Can I make a contribution for 2006?

No, you made too much money. For 2006, if your modified adjusted gross income was less than $95,000, you could make a full contribution to your Roth IRA. The rules say if it was more than $110,000, you cannot make any contribution. If it was between $95,000 and $110,000, there is a formula to calculate a partial contribution limit.

If you were married and filed a joint return, you could have made up to $150,000 and made a full Roth IRA contribution. If you were married and your modified adjusted gross income was over $160,000, no contribution would have been possible. For incomes falling between these numbers, a partial contribution determined by a formula could have been made.

Also note the income limits are now indexed; they will be higher in 2007 and beyond.

4. I have an existing traditional IRA and I want to roll it over to a Roth IRA. Is this possible?

It depends on four things: What year it is, how much money you make, your marital status and the type of income tax return you file. If you are talking about a tax year before 2010 and your adjusted gross income exceeds $100,000 or you are married and file a separate return, you can’t convert your traditional IRA to a Roth. Period.

After 2009, these limitations don’t apply and you are good to go. Moreover, you can spread the income tax due on the rollover over tax years 2011 and 2012.

5. I am 55 and have had my Roth IRA for 3 years. I just went on disability and need to withdraw a good portion of it. Is the withdrawal taxable? And since I am not 59 1/2 do I have to pay the 10% penalty tax?

Your Roth IRA consists of two elements: your contributions and earnings. You can take out any amount up to your total contributions tax free.

In order for any earnings withdrawal to be tax free, the distribution has to be a “qualified distribution”. To be qualified, the distribution needs to be made after five taxable years starting with the first Roth contribution.

Then assuming this five year rule is satisfied, you can take out money tax free if you are over age 59 1/2, disabled, or to buy a first home for yourself, your spouse, children or grandchildren ($10,000 maximum). The rules go on to say if you die and your spouse elects to treat your Roth IRA as their own, any distributions would be qualified.

Distributions before age 59 1/2 are subject to a 10% premature penalty tax. However, this tax only applies if the distribution is includable in income. If you take out your contributions, these are not taxed.

In your case, you qualify for one of the exceptions: disability. So there is no 10% penalty tax.

These examples are based on my interpretation of the rules and should not be relied upon as tax advice. The complexities of distributions from any qualified plan or IRA underscore the necessity to consult with a qualified tax professional prior to making any withdrawal.