Does the New “Safe Act” Make Private Money Lending and Seller Financing Illegal?

Have you heard about the “SAFE Act” yet?  If you aren’t familiar with it, you need to be…. and FAST!  Why?  This relatively new piece of legislation was original designed “to enhance consumer protection and reduce fraud by encouraging states to establish minimum standards for the licensing and registration of state-licensed mortgage loan originators.”

So, what’s the problem with that?  Like much legislation that is designed to “protect consumers”, it can include some very negative effects on certain niche people or businesses.  In this case, the SAFE Act can potentially make Owner/Seller Financing ILLEGAL in some states (buyer or selling), and may also make it illegal for your Private Lenders to fund your deals without first obtaining a license to do so! This is a new twist on what we have seen with other recent legislation since YOUR LENDER can even get into trouble here, not just you!  However, if you want to keep operating your business with private capital and maintaining good relationships with those lenders, it would certainly be in your best interests to learn the new requirements in your state and understand how to navigate and/or legally bypass them so that you can safely continue to operate.

Although this Act came to exist back on July 20th, 2008 as a key component of HERA (Housing and Economic Recovery Act), HUD established a deadline for states to create and pass their OWN legislation that complies with the minimum standards of the SAFE Act no later than July 31st, 2009 for some states, and July 31st, 2010 for the rest.  That means that ALL states will have this new legislation in force by now, but because it was left to the individual states to define their own standards, every stay can and will have different rules.

If you intend to use private money or owner/seller financing, either buying or selling, in your business, you NEED to be on this webinar! This is cutting edge information that you won’t find anywhere else.  Most attorneys cannot advise you on this legislation yet as they are just now learning about it themselves!   Chris will not only discuss how the new Act may limit you, but also the tools and tactics that you will need in your real estate arsenal to avoid trouble. As with most things, the fix can be fairly simple, as long as you know the rules.

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What are the benefits of using a full service broker over an online discount broker to invest my IRA Rollover?

I am looking @ withdrawing from my IRA rollover from a previous 401k? Can I take a partial withdrawal or all?

Am in a situation where for piece of mind I would like to pay off some debts. I realize the taxing and what not and I am not yet eligible to start a 401k @ my new employer, however, I know i am still young, and can learn from this

is it better to open a rollover IRA in a Bank or some inverstment firms?

i have a lumpsum pension coming up in a couple days, but i dont have time to decide what to do about it. I guess putting it into any IRA will defer taxes for now, and i can decide what and where later. any advice? i am over 60 now. can i withdraw any amount anytime from the ira? Is tax still 25% on the withdrawals?

Can human resources/plan administrator stop or deny my rollover into an IRA?

I left my job under non-amicable conditions and would like to rollover my money to an IRA. The direct rollover must be approved by the plan administrator. I want to know if she can deny or stop the rollover legally and if not, is there anything I can do to force her to approve it faster.

Are there any tax advantages in converting a rollover IRA into a Roth IRA?

As I understand it, if I convert the rollover into a Roth, I will then have to report the entire amount on my taxes as income the year I do the conversion. So after “x” number of years when I’m ready to start taking money out of my Roth, won’t I get taxed again? Am I setting myself up to let the IRS tax me twice on some of the same money?

401k Rollover Advice Avoiding The 20% IRS Penalty by Bill Losey, CFP.mp4

www.BillLosey.com Retirement strategist, retirement expert and CFP, Bill Losey provides 401K rollover advice on avoiding the 20% IRS penalty.

Ira Charitable Rollover Opportunity Rolls On Through 2009

As part of the Emergency Economic Stabilization Act of 2008, Congress allowed an important window of opportunity to remain open—one that enables IRA owners age 701/2 or older to directly transfer up to $100,000 tax-free to charity in both 2008 and 2009. Because this provision applies to every individual IRA holder, a husband and wife who both meet the minimum age threshold could effectively move $400,000 out of their taxable estate over the next two tax years.Is Transferring Money from Your IRA to a Charity Right for You?The ability to transfer money tax-free from your IRA to contribute to a charity can be an excellent way to advance both your philanthropic and estate plans. While you will not receive a charitable deduction for a transfer from your IRA to a charity, the amount of your transfer will never be included in your gross income.If you fit any of the following profiles, we encourage you to contact your financial and tax advisor before year-end to help determine if this provision is appropriate for you.? Are you 701?2 and already receiving your required minimum distributions (RMDs)? Any IRA holder who has reached the age of 701?2 is eligible to make the tax-free transfer of funds from his or her IRA to a public charity. Also at 701?2, the IRA holder starts to receive the taxable required minimum distributions (RMDs) from his or her IRA. Accordingly, at year-end, many charitable-minded IRA holders with excess RMD amounts would prefer to use these funds for charitable contributions. The 2006 Pension Act permits an IRA holder to distribute either a portion or all of his or her RMD tax-free directly from his or her IRA by transferring any amount up to a total of $100,000 to a favorite qualified public charity. The IRA holder reduces his or her taxable income by the amount distributed and the charity receives a contribution. ? Do you have a large IRA that likely will be subject to estate taxes at death? IRA assets are subject to estate taxes and estate beneficiaries may have to pay income taxes on IRA assets they inherit. Using the IRA charitable distribution provision permits an IRA holder to reduce the size of his or her estate, thereby reducing the total amount of taxes imposed.? Do you take the standard deduction when calculating your taxes or do you itemize? Many retirees take the standard deduction when calculating their income-tax liability because they don’t generate enough deductible expenses or income to make itemizing worthwhile. As a result, they could be losing out on the tax advantages of deducting their charitable donations. An IRA holder who uses the tax-free IRA charitable-distribution provision as a way to make charitable contributions will be able to obtain the tax benefit of the contribution without having to itemize his or her deductions.? Are you collecting Social Security? An IRA holder who collects Social Security is also required to receive the RMD from his or her IRA at age 701?2. The amount of the RMD could increase income to a level where a portion of your Social Security benefit is taxable. By using the IRA charitable distribution provision, the IRA holder may reduce total income and thereby reduce the taxes imposed on Social Security benefits.? Are you interested in donating more than 50% of your annual income in 2008 or 2009, or both years? Typically, a donor may only deduct a cash contribution to a charity up to 50% of his or her adjusted gross income (AGI) in any given year. Any excess charitable contribution deductions are carried over to the following five years. By using the tax-free IRA charitable-distribution provision to transfer money directly from an IRA to a charity, the donor effectively “skips” the 50% AGI charitable deduction limitation. Therefore, an IRA holder may donate up to $100,000 per year in 2008 and 2009 from his or her IRA without having to worry about the 50% AGI charitable deduction limitation. An IRA holder who has a large IRA may use this method to reduce its size during his or her lifetime leaving less exposed to income and estate taxes at death.? Did you wish to complete a gift to a charity for a particular purpose? Charitable-minded individuals may have in mind ambitious programs such as underwriting a research project or sponsoring a scholarship program at their alma mater, but had been hampered from making any contributions by current tax laws such as the 50% AGI charitable contribution limitation for cash contributions discussed in the previous paragraph. The IRA charitable-distribution provision may be an ideal strategy that would enable an IRA holder who wishes to make a substantial donation in 2008 or 2009 to fulfill these charitable goals in a tax-advantageous manner.? Do you live in a state with unfavorable tax rules for charitable deductions and RMDs? The ability to make a tax-free transfer to charity from an IRA could be especially appealing to residents in states that impose state income tax on IRA distributions and don’t allow any offsetting charitable deductions. The 2006 Pension Act permits the IRA holder to make the charitable contribution directly to a qualified charity from his or her IRA and not have to treat the contribution as a taxable IRA distribution, thereby avoiding any state or local tax imposed on IRA distributions.Additional RequirementsAny IRA holder who takes advantage of the tax-free IRA charitable distribution must send a letter to the qualified charity informing the charity of the donation. Here are some important points to keep in mind:? You must be 701?2 on or before the date of the charitable transfer.? Contact us before making a donation to arrange for the proper transfer of funds from your IRA to the charitable organization.? You may not write a check to the charity from another account into which you transferred your IRA funds. Doing so would eliminate the tax-free treatment and would cause the amount distributed to be included in your taxable income.? Donor advised funds and most private foundations are prohibited from receiving IRA rollover gifts.? You cannot receive anything of value in return for your donation. For example, you cannot get tickets to a charitable event for your donation.? The transfer must come from a traditional or a Roth IRA. Transfers to a charity from other retirement plans, such as a SEP or SIMPLE IRA, or from a 401(k) or 403(b) plan will not qualify under this provision. It may be possible, however, to roll over funds from these accounts into a traditional IRA or a Roth IRA and then make an eligible transfer to charity.? A qualified charitable distribution is treated as coming first from deductible contributions and earnings. If you have made non-deductible contributions to your IRA, have your tax advisor determine how much of the donation is considered tax-free under this provision. After the IRA Charitable Distribution: Written Documentation RequirementCash donations, regardless of whether the contributions are made from an IRA or another source, must be backed up by “proper” records, such as a check, bank copy of the check, electronic funds transfer record, credit card or credit union statement, payroll stub or W-2 (in the case of a payroll deduction). These must show the name of the charity, the donation amount and the date paid or transaction posting date. A written acknowledgment from the charity showing that information also will suffice.Graeme H. Patey is a Financial Advisor located in Cleveland, Ohio and may be reached at 216-523-3015 or www.fa.smithbarney.com/graemepatey. Smith Barney does not provide tax or legal advice, and it is important to consult with a tax or legal advisor before investing.© 2008 Citigroup Global Markets Inc. Member SIPC. Securities are offered through Citigroup Global Markets Inc. Smith Barney is a division and service mark of Citigroup Global Markets Inc. and its affiliates and is used and registered throughout the world. Citi and Citi with Arc Design are trademarks and service marks of Citigroup Inc. and its affiliates, and are used and registered throughout the world. Working WealthSM is a service mark of Citigroup Global Markets Inc. Citigroup Global Markets Inc. and Citibank are affiliated companies under the common control of Citigroup Inc.INVESTMENT PRODUCTS: NOT FDIC INSURED • NOT GUARANTEED • MAY LOSE VALUE

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How To Rollover 401k Into Self Directed IRA?

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