For details, watch the video below:
Tax Return for UBIT – Does your retirement plan own leveraged real estate or an active business?
Just a quick, last-minute reminder…
- If your IRA owns mortgage-leveraged real estate, you owe UBIT.
- If your IRA or 401(k) owns an active business structured as a pass through entity (such as an LLC or partnership), you owe UBIT.
- If your 401(k) owns mortgage-leveraged real estate AND the mortgage is a “seller carry”, you owe UBIT.
UBIT, or Unrelated Business Income Tax, applies to tax exempt organizations including retirement plans. To pay UBIT, Form 990-T must be filed with the IRS. If this is all news to you, once you are done scolding yourself, you may want to file for an extension using Form 8868.
Filed Under: Self Directed IRA Solo 401k Tagged With: custodian, form, forms, ira, ira llc, irs, loan, mortgage, non-recourse, nonrecourse, self directed, solo, Solo 401k, taxes, UBIT, UBTI, UDFI, unrelated business income, unrelated business income tax, unrelated business taxable income, unrelated debt financed income
