I appreciate the responses. FYI here is a link that discusses the RE IRA--it is something that can be done--check it out: http://moneycentral.msn.com/articles/retire/invest/1224.asp

My biggest question too, has been, what do you do when the min. required distributions kick in? Distributing the entire property to yourself, and assuming you want to keep it (our 2nd home is located next to this lot, so the lot increases the value of our home), rather than sell it, doesn't appear to yield the best answer (i.e. in 30 years, that could potentially be one large distribution). This property we would want to hold, perhaps that long. If we did decide to sell it, the proceeds would remain in the IRA, and then it would become part of the funds available for the MRD's, which would be easily dealt with and no negative ramifications.

Despite some of the caveats, I can see where this could make sense. I am strictly coming from the standpoint where we have cash available to invest sitting in the IRA's, versus having to purchase this under some financed arrangement. . .and given that the stock market has been unpredictable, I would like to invest where it is a safe bet that the land will appreciate.