Not many people realize it, but you can own property as part of an IRA. I haven’t talked about it lately, but I have mentioned it in blogposts past. For those unaware of the rules regarding that, though, your first thought might be, “Cool! I have have a summer home.” or “Yay! Easy passive income.” Now, before you get your hopes up and get all excited, I need to bring you back down to earth and remind you that what seems nice and easy in regards to your retirement accounts probably isn’t that simple (you really think the IRS would make things easy? lol.). Yes, you can own property in your IRA, but you can’t own a vacation home (or second home) and general upkeep must be handled by an independent, third-party property manager–who also must be paid out of IRA funds. Furthermore, owning a property does not change required minimum distributions (RMDs), so you need to ensure you have enough actual money in the account to take care of those as well. Then there is also the risk of making a prohibited transaction, the penalties for which will basically destroy your IRA and most likely wreck your retirement. Thus, you will want to think long and hard about whether using money from your IRA to invest in property is a good idea. Ideally, if you do decide to do so, you have more than enough liquidity in your accounts to handle the costs as well as RMDs. You will also want to make sure you hire a reputable and reliable property manager to oversee the property. However, before you do any of that, you will want to speak with a certified financial planner or wealth manager. You will want to go over what the risks are (i.e. penalties for a prohibited transaction, whether you can afford the property, etc.). These questions may lead you to rethink the idea or abandon it altogether. So, are you planning on owning property in your IRA?