Keogh Plan - Posted by Ken (NJ)

Posted by Ken (NJ) on February 27, 2002 at 10:07:50:

Entrust has a new self-directed keogh plan which I find quite interesting. I recently went full time REI, so I could roll my old 401K funds into a new, self-directed keogh with a 401K component. The plan would then be to have the 401k provide 20% down payment money for rental properties. I would get the 80% through a loan. Essentially, I partner with the 401k, which avoids UBIT.

My question comes from management issues. I understand that I am prohibited from personally managing the properties as a disqualified person. However, could I manage the properties as 401k trustee? The trustee has the right to manage plan assets, which in this case is real estate. Entrust says yes, but it strikes me as a gray area.

How risky do you think this strategy is?