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UBIT Tax Considerations – Using seller finance with Roth Solo 401k
Posted by DIVINA KUMETZ on August 3, 2021 at 4:25 amLooking for clarification, If we use seller finance in a roth 401k SD it is subject to tax but what is it taxed on just profits or the whole mortgage. In addition if it loan is payed back the tax should stop.
Steven Hamilton replied 2 years, 3 months ago 3 Members · 3 Posts -
2 Replies
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DIVINA KUMETZ
August 3, 2021 at 4:25 amLooking for clarification, If we use seller finance in a roth 401k SD it is subject to tax but what is it taxed on just profits or the whole mortgage. In addition if it loan is payed back the tax should stop.
DIVINA KUMETZ -
George Blower
August 3, 2021 at 4:30 amThank you for posting your question!
Can you please help shed some light on this topic?
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Steven Hamilton
August 16, 2021 at 2:56 pmHello Divina,
Typically seller financing will not trigger UBTI on real estate transactions. Whereas inside an IRA the allocated amount of net profit would be taxable.
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