Laura Seitz, Deseret News
Amy Pace and her daughters, Taya, 4, left, and Shaylee, 2, stand near a lot they purchased to build a home on in 2011 in Layton.

In an attempt to determine whether one could invest $100,000 in real estate and sell it for $400,000 in 20 years without paying taxes, an article from Market Watch researched the possibility of buying real estate with an IRA.

The short answer is yes, though it is tricky, Mark Luscombe, a CPA and attorney, told Market Watch. You have to create a self-directed IRA, which could mean setting up a limited liability company to hold the assets.

When you find the property you want to purchase, find a plan administrator that is willing to use your funds to buy real estate. That means they must be convinced it’s a good investment to own that property.

The administrator should not be promoting properties, but only administering accounts. Some administrators have vested interests in selling their specific product, similar to some commission-based financial planners.

As you put retirement funds into the new account, the more money there is, the better the self-directed program will be. When buying property, make sure it will appreciate in value and create enough cash flow that will cover your costs.

For those who have less than $100,000 to make it a self-supporting property, set up the account in a way that allows you to contribute $5,000 or more per year. These are done through SEP-IRA or solo-401(k) accounts.