How to Use Your IRA or 401(k) to Invest in Real Estate Syndications

Investing in real estate syndications is one of the most powerful ways to build long-term wealth. But did you know you can also use your retirement funds like an IRA or 401(k) to invest passively in these real estate deals?

This blog breaks down how to use your IRA or 401(k) to invest in hotel or multifamily syndications, what the rules are, and why many savvy investors are turning to this strategy to maximize returns while minimizing taxes.

Whether you’re a physician, business owner, or high-income professional, this could be a game-changing move for your retirement portfolio.

What Is a Real Estate Syndication?

A real estate syndication is when a group of investors pool their money to purchase a large property like a Marriott-branded hotel or an apartment building. A sponsor (such as Qila Capital) manages the asset while passive investors earn a share of the income and profits.

Passive investors do not manage tenants, contractors, or property operations. Instead, they enjoy:

Quarterly cash flow
Tax-advantaged returns
Equity upside at sale

Can I Use My IRA or 401(k) to Invest?

Yes but not your traditional brokerage IRA or 401(k).

To invest in alternative assets like real estate syndications, you need a Self-Directed IRA (SDIRA) or a Solo 401(k). These accounts are IRS-approved and offer the same tax-deferred or tax-free benefits of traditional retirement plans but allow you to invest in private real estate deals, precious metals, startups, and more.

Types of Retirement Accounts You Can Use

Here are the most common types of retirement accounts used in syndications:

1. Self-Directed IRA (SDIRA)

Allows investment in real estate, private equity, and more
Works like a regular IRA, but with a broader range of investment choices
Administered by a custodian who handles compliance and paperwork

2. Roth Self-Directed IRA

Contributions made after tax, but earnings and withdrawals are 100% tax-free (if rules are followed)
Ideal for younger investors with long-term growth goals

3. Solo 401(k)

For self-employed individuals or small business owners
Higher contribution limits than an IRA
Fewer custodial restrictions than SDIRAs

These accounts let you invest passively in real estate without triggering early withdrawal penalties as long as funds stay inside the retirement account.

Why Use an IRA or 401(k) for Real Estate Investing?

Tax-Advantaged Growth

Your distributions and gains grow tax-deferred or tax-free
Compound your returns faster than in a taxable brokerage account

Diversification

Get exposure to real assets beyond stocks and bonds
Reduce risk from market volatility

Hands-Off Income

Let your retirement funds generate passive income while you continue your career
Ideal for busy professionals and retirees alike

Step-by-Step: How to Use Your IRA to Invest with Qila Capital

Step : Open a Self-Directed IRA or Solo 401(k)

Choose a reputable custodian like Advanta IRA, Equity Trust, or Rocket Dollar. They’ll handle compliance, reporting, and help set up your account.

Step 2: Transfer or Roll Over Funds

Move funds from an existing IRA, 401(k), or Roth account into your new SDIRA or Solo 401(k). This is not a taxable event if done correctly.

Step 3: Select an Investment

At Qila Capital, we’ll provide you with investment opportunities—including cash-flowing Marriott-branded hotels and value-add hospitality deals.

Step 4: Direct the Investment

You instruct your SDIRA custodian to fund the investment directly into the real estate syndication. The asset is titled in the name of your retirement account (e.g., “XYZ Trust Company FBO John Smith IRA”).

Step 5: Sit Back and Receive Returns

All cash flow, profits, and equity gains go directly back into your IRA growing your retirement savings with every distribution.

Important Rules to Know

Using your IRA or 401(k) for real estate syndications comes with strict IRS rules. Violating them can result in penalties or disqualification of your retirement account.

No Self-Dealing

You (or close family members) cannot:

Personally guarantee loans
Use the property
Pay yourself from IRA funds
Live in or work for the property

All Expenses and Income Stay in the IRA

If your IRA owns the asset, all returns go back into the IRA, and all expenses (legal, closing, etc.) must be paid from the IRA.

UBIT and UDFI

Some leveraged real estate investments may trigger Unrelated Business Income Tax (UBIT) or Unrelated Debt-Financed Income (UDFI). Ask your CPA or custodian to see if it applies to your deal.

Who Is This Strategy Best For?

Accredited investors who want to unlock their retirement funds
Self-employed professionals or small business owners with Solo 401(k)s
Physicians, attorneys, and tech professionals with rollover 401(k)s from previous employers
Real estate investors seeking true diversification

If you’re unsure where to start, book a discovery call and we’ll walk you through it.

What Kind of Returns Can I Expect?

At Qila Capital, our real estate syndications are structured for long-term, risk-adjusted growth. While returns are never guaranteed, our hotel syndications typically target:

8–10% Preferred Cash Flow (Annual)
14–18% IRR (Internal Rate of Return)
3–5 Year Hold Period
Equity Multiple of 1.7x – 2.0x

And since your IRA holds the investment, your earnings continue to compound tax-deferred or tax-free.

Why Qila Capital?

At Qila Capital, we specialize in high-performing real estate syndications, including Marriott-branded hotels in strategic U.S. markets. Our team focuses on:

Capital preservation
Attractive risk-adjusted returns
Investor-friendly deal structures
Full transparency and communication

We work closely with investors and their custodians to ensure every retirement investment is handled with precision.

FAQs

Can I invest in Qila Capital deals through my Roth IRA?

Yes, Roth SDIRAs are eligible. All earnings and distributions will be tax-free if held to retirement age.

Will I owe taxes if I roll over a 401(k) to a Self-Directed IRA?

No. As long as it’s a direct rollover between qualified accounts, there are no taxes or penalties.

What is the minimum investment amount?

Most Qila Capital opportunities require a minimum of $50,000 to $100,000, whether funded personally or via IRA.

Can I split an investment between cash and IRA funds?

Yes. You can invest partially with personal capital and partially through your IRA, but they must be treated as separate entities.

How do I get started?

Visit qilacapital.com/contact-us to schedule a free discovery call and get step-by-step guidance tailored to your situation.

Final Thoughts

Using your IRA or 401(k) to invest in real estate syndications is one of the smartest moves for long-term, tax-efficient wealth building. If you’re ready to break free from the stock market and take control of your retirement growth, passive real estate investing with Qila Capital could be the perfect fit.

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