Thursday, May 13, 2021

What is a Self-Directed IRA? - Jay Conner & John Dwyer

One of the most important investing tools that Jay has known for years is this thing called Self-Directed IRA.

What is a Self-Directed IRA? How do you take advantage and use this in your real estate business?

Learn the answers to these questions now!

Click on this link to watch the complete video: https://youtu.be/2lSf2LjQhxQ – “ How Wealth Works In Real Estate with John Dwyer & Jay Conner”

Let’s talk about money, investments, and wealth together with Jay Conner and his special guest John Dwyer.

John Dwyer is an eight-time recipient of Ohio National’s Inner Circle (top 1% of U.S. financial representatives).

A five-time qualifier, and a four-time recipient of the Executive Counsel of Honor, and was elected by his peers to serve as a current member of the Ohio National Field Advisory Board.

John also qualified for the 2017 GAMA Silver International Management Award.

Currently serves on the Field Advisory Board of Ohio National.

Was elected “40 Under 40” Prairie Business Magazine in 2015, and is a Master Mentor of both Circle of Wealth and The Breakaway League.

As the President and CEO of Solid Rock Financial Group, John leads the organization with incredible passion and vision.

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Jay Conner:

One of the most important in my opinion, strategies or investing tools that I know of today and have known of for years is this thing called self-directed IRA's. And I know you're an expert in this area when it comes to advising your clients on what a self-directed IRA is, how to take advantage of it. And of course that could easily be a full day seminar conversation, but just take a couple of minutes, tell people what self-directed IRAs are and why it is, they might want to consider talking with you about getting one set up if they don't have one set up.


John Dwyer:

Well, so a self directed IRA is where typically where you have money in the 401k and other type of retirement account, and you can move that money into an account to where you can manage and do different things with it. Right? And so it real simple terms, a self-directed IRA is you get to utilize the money inside the 401k arena or let me call it qualified plan money, and go do different things with that money. You can buy gold, you can buy different assets, can buy real estate. Now what I would say though, Jay is this. And I think where the important conversation is that when we look at future tax rates, maybe the self-directed IRA is not the best place to utilize a real estate deal. Because when we look at real estate, one of the reasons or advantages of real estate is what Jay?


Jay Conner:

Well, there's lots of benefits. It depends on what you're doing with it. If you are buying and holding it, and if you've sold it on rent to own, then of course you get to take advantage of depreciation on the tax advantages such as that. So that's just one big benefit if you're buying and holding,


John Dwyer:

Buying, and holding, right. And you also get the, like you said, the depreciation, we also get gap cap gains treatment. Right now, the under current administration who knows where that's going to go to, that's a whole another conversation, but the problem that I potentially see inside of a self-directed IRA, it's not that it's bad, but we just have to be aware of if, what, if you could get that money outside of the self-directed IRA. Now there's tax consequences of that. But see, when you buy real estate inside of a self-directed IRA, you're taking a tax advantage asset and moving into a qualified plan asset. And you're basically just postponing that tax to someday in the future. Now there's all different types of rules and things like that as relates to the self-directed IRA. But it's something that we should maybe consider thinking about because of the tax ramifications around holding that asset in that self-directed IRA.


John Dwyer:

And so it's not a matter of they're good or they're bad, or it's just, we have to look at what the overall plan is. And in my opinion of taxes are going to go up. I want to get as much money taxed out. I want to pay as much taxes as I can today, as crazy as that sounds, because I don't want it to come back to bite me in the future. I want to hold the real estate outside the assets outside of that self-directed IRA. So I have some of the tax benefits. Now, again, we have to look at current tax code. We have to look at what's going on. Like, current administration could change that. They're talking about moving cap gains rate up to 39.9, 39.6%. Right? You're talking about getting rid of the 1031 exchanges. They're talking about doing all these different things. So as it relates to tax strategies and where our money is held, again, it goes back to what I talked to you about it. I don't care what my asset value is. I care about what I can spend. And so those are the conversations that we have to have.

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