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How to you move real estate from a IRA 401 (K) trust to a taxable account like a LLC?

ThomasIT
Level 1

My sister had a business in a building and the owner decided they wanted to sell it. The owner asked my sister was she interested. She didn't have the funds so she asked me could I help. I didn't mind because that business was her families livelihood. I had the asking price in my 401K account at work. I found this company to set up me an IRA Solo 401 (K) trust account. I then performed a rollover between accounts to allow the trust to buy the property. I have come to know the property is considered to be historic and qualifies for tax incentives for renovations, etc. However, my CPA indicated I cannot use them because the trust isn't a pass through entity for tax purposes. I asked him could I create an LLC and transfer the property to a LLC. He indicated that would be considered a taxable event/distribution and penalties would apply. I responded, I understand. What question do I ask the business that set up the IRA on what I'm wanting to do without them telling me, we don't give tax advice. Any help would be appreciated. Thanks

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1 Comment 1
qbteachmt
Level 15

"without them telling me, we don't give tax advice."

Well, you found an internet community of people using Lacerte, ProSeries and ProConnect income tax preparation programs. You question seems not to be related to tax preparation for your client using one of the programs, nor discussing recent or past tax issues that might affect your job.

You seem to be asking for personal tax help. Your CPA already gave you advice and you stated you understand. I would go with that.

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