Partnering to Purchase Investment Real Estate with Your Self-Directed IRA

Partnering to Purchase Investment Real Estate With Your Self-Directed IRA

With the fluctuations in the public markets, a lot of investors are looking for alternatives to place their money in, including their retirement funds. One of the most popular alternative investments people are turning to is real estate. A lot of people who are not familiar with the concept are intrigued when they find out they can actually use their retirement funds for real estate investing. Additionally, partnering IRA funds to invest offers flexibility and expands the choices one has when considering assets.

There are a few ways an investor can use retirement funds to invest in real estate, but one of the most common ways is partnering IRA funds with your personal funds or with someone else. There are a lot of different ways investors can structure the transaction, but to put it simply, an investor can partner with anyone (even disqualified parties) in order to purchase a property. The most common example of this is a tenants-in-common purchase. The IRA will own a specified percentage of the property, and the other partner will own a specified percentage of the property. Once the property is closed on, all income and expenses related to that property are split pro-rata according to the percentage of ownership between the IRA and the other partner.

There are no limits to the number of partners you can have, and there is no limitation on what the percentages of ownership can be. The investors are in complete control. This is common for a lot of IRA owners as they may not have enough in their retirement accounts to purchase the property alone. Partnering IRA funds allows them to invest in real estate, diversify their portfolio, and protect their profits.

Midland Trust specializes in real estate investments in self-directed IRAs. We do not sell investments or give advice, but we facilitate the administrative details of your account to comply within the rules for these accounts.

For more information, contact Midland today.

Investing in Oil and Gas Using a Self-Directed IRA

Investing in Oil and Gas Using a Self-Directed IRA

Self-directed IRAs have become a popular investment vehicle for investors looking to purchase alternative assets outside of the typical stocks, bonds, and mutual funds. Since IRAs were established in 1974, more people are becoming aware of the benefits they have to offer. Unlike a typical IRA or 401(k), a self-directed IRA gives investors the opportunity to invest in real estate, futures & forex, precious metals, mortgage notes, and oil and gas assets all while building a tax-sheltered income.

Investments in oil and gas are one example of alternative assets investors acquire to add diversity to their retirement portfolios.

How can you invest in oil and gas with your Midland self-directed IRA?

  • Invest in land being explored for these minerals
  • Invest in mineral rights of land being explored
  • Purchase interests in oil and gas refineries and/or drilling companies
  • Acquire commodities and/or futures contracts

Your self-directed IRA can also invest in other energy investments including:

  • Wind and solar options
  • Hydroelectric energy, hydropower, and wave power
  • Natural gas and coal
  • Geothermal energy
  • Biofuel

Midland Trust makes the process of investing in these alternative assets inside of your self-directed IRA just as simple as investing outside of your IRA. However, with a self-directed IRA, you enjoy the benefits of a tax-sheltered account. Below are the steps to invest in oil and gas with your self-directed IRA.

  1. Fill out a Midland Trust application
  2. Fund your Midland IRA account by…
    1. Making a personal contribution
    2. IRA to IRA transfer
    3. 401(k) to IRA rollover
  3. Fill out Midland’s Private Purchase Authorization Form
  4. Provide Midland with the investment documents from the energy company such as the Subscription Agreement. The vesting on the documents will be Midland Trust, Inc. FBO Client’s Name and IRA Number.
  5. Your IRA is now invested in oil and gas assets and all income is deposited into your IRA tax-free.

Before you invest in any asset make sure you do your due diligence by researching the investment options thoroughly to avoid fraud, understanding the benefits and risks of the investment, and consulting with financial, accounting, and industry professionals before making decisions.

To learn more contact Midland IRA at 239-333-1032 or visit

Note: You may be subject to unrelated business income tax (UBIT) if your IRA incurs a debt in order to acquire an asset, such as a loan from a bank. Midland IRA is not a fiduciary and does not endorse or sell investments. This article is for educational purposes only.