Profit from Investing in Chicago Real Estate in a Retirement Account: - For those looking to develop a real estate portfolio with tax preferences in an area that is rated the best for buyers, Chicago is the place to buy.  Do profit the most from both buying and selling properties for profits, and/or holding on to let the rental income increase,Chicago real estate investing retirement account these properties should be held in a retirement account such as a 401(k) and individual retirement account (IRA). 

  Due to a variety of factors, holding real estate in Chicago or mortgages on those properties in a retirement account is ideal at this time.

Zillow, the real estate research group rates Chicago the best area for buyers among 142 locales in the United States.  That results from the time it takes to sell a property, how much the price is reduced, and how often the price is reduced.  Chicago is a great area for those looking to invest in real estate.

Investing in real estate can involve the actual buying of the property, or providing a private mortgage to a party looking to purchase.  A private mortgage is the financing provided for a property from an individual lender or a group.  According to Jerry Cohen, President of EquityBuild, a premier private mortgage investment firm, “There are two methods for getting started in private mortgages: Mortgage Pools and Direct Lending.  Mortgage pools are like the mutual funds of private mortgages. Each investor's money is pooled with the other investors participating in the pool and the money is used for private lending.

Cohen, who was just awarded the prestigious “Moving America Forward” honor for the success of EquityBuild and EquityBuild Finance, its financial arm, furthered that, “Direct lending is typically reserved for seasoned real estate professionals due to the level of expertise that is needed to identify undervalued properties...”

“Undervalued properties” is certainly the story in Chicago, at this time.  That is what makes it such a great time to invest in real estate through either buying or financing the purchase.  Placing the property or the mortgage in an IRA or 401k yields a wide range of tax benefits.

The first major tax break is that each dollar that is placed in the retirement account is tax deductible.  That greatly reduces the income tax for the investor.  Depending on your financial situation, this can be significant.

If you are looking to buy and sell properties or mortgages for profit, the retirement account offers even more tax protection.  As it is in a retirement account, there is no capital gains tax. The profits from buying and selling are all tax free.

That is huge.

What can also be epic is that the rental income is also tax free.  As rental income has been going up, there is an even more compelling reason for having investment real estate or mortgages in a retirement account.  When held in a retirement account, investment properties and notes function like a municipal bond, except with a much higher yield that rises over time.

There has a yet to be a full recovery in the real estate market in Chicago.  For that, real estate investors should be thankful as there is ample upside for profit.  Making those gains even more sizable is the holding of investment real estate or the mortgages in a retirement account to maximize the tax benefits.