Buying RE in a Corp Entity Versus in Your Own Name ?

[4plexowner]

I held each of my properties in its own LLC – as meadandale said, this isolates issues at one property from all the other properties – I considered the $800 / year for each of the LLCs as an insurance premium for my own financial security

it is easy to transfer real estate from an individual to an LLC – just record some paperwork with the city and it’s done – as long as both parties in the transfer are related, the transfer is not considered a sale and therefore no re-assessment of tax basis is required

seems like there are two ways to get residential real estate into a corp:
1. buy property as individual and transfer to corp
2. buy property as corp

I don’t know about number 1 – anyone else? – is this possible? – does it trigger a tax re-assessment? – what does the mortgage holder/servicer do when they receive a copy of the newly recorded transfer?

Number 2 is easy but the corp has to qualify to purchase the property – income, assets, credit history, etc

[sdduuuude]

I’ve always wondered if you couldn’t buy a place with a corporation. Then when you sell it, just sell the corporation and hand over the stock.

If you do this – does the tax base reset ?
Can you keep the mortgage in-tact ?

Do corps. may pay higher interest on loans ?

[sdduuuude]

I’ve always wondered if you couldn’t buy a place with a corporation. Then when you sell it, just sell the corporation and hand over the stock.

If you do this – does the tax base reset ?
Can you keep the mortgage in-tact ?

Do corps. may pay higher interest on loans ?

[sdduuuude]

I’ve always wondered if you couldn’t buy a place with a corporation. Then when you sell it, just sell the corporation and hand over the stock.

If you do this – does the tax base reset ?
Can you keep the mortgage in-tact ?

Do corps. may pay higher interest on loans ?

[sdduuuude]

I’ve always wondered if you couldn’t buy a place with a corporation. Then when you sell it, just sell the corporation and hand over the stock.

If you do this – does the tax base reset ?
Can you keep the mortgage in-tact ?

Do corps. may pay higher interest on loans ?

[sdduuuude]

I’ve always wondered if you couldn’t buy a place with a corporation. Then when you sell it, just sell the corporation and hand over the stock.

If you do this – does the tax base reset ?
Can you keep the mortgage in-tact ?

Do corps. may pay higher interest on loans ?

[SD Realtor]

Not an expert at this by any means but I believe purchasing in the corporate name is harder then buying in your name and transferring. The difficulty lies within the financing aspect of it. If the financing is done with the corporation owning the home then the lender assumes liability in the event of the corporation defaulting on the loan and if the corp has no assets then the lender is s.o.l. I would imagine if you add some sort of personal gaurantee behind the corp then the lender would be more open to letting financing be done in the name of the corp.

Again, guys like surveyor and multipleprop are better suited to answer your question.

Without ever trying it my guess would be to buy in your name and transfer it into the llc after. Then repeat for each property with an assumption you will setup a corp per rental. That would maximize your liability.

[SD Realtor]

Not an expert at this by any means but I believe purchasing in the corporate name is harder then buying in your name and transferring. The difficulty lies within the financing aspect of it. If the financing is done with the corporation owning the home then the lender assumes liability in the event of the corporation defaulting on the loan and if the corp has no assets then the lender is s.o.l. I would imagine if you add some sort of personal gaurantee behind the corp then the lender would be more open to letting financing be done in the name of the corp.

Again, guys like surveyor and multipleprop are better suited to answer your question.

Without ever trying it my guess would be to buy in your name and transfer it into the llc after. Then repeat for each property with an assumption you will setup a corp per rental. That would maximize your liability.

[SD Realtor]

Not an expert at this by any means but I believe purchasing in the corporate name is harder then buying in your name and transferring. The difficulty lies within the financing aspect of it. If the financing is done with the corporation owning the home then the lender assumes liability in the event of the corporation defaulting on the loan and if the corp has no assets then the lender is s.o.l. I would imagine if you add some sort of personal gaurantee behind the corp then the lender would be more open to letting financing be done in the name of the corp.

Again, guys like surveyor and multipleprop are better suited to answer your question.

Without ever trying it my guess would be to buy in your name and transfer it into the llc after. Then repeat for each property with an assumption you will setup a corp per rental. That would maximize your liability.

[SD Realtor]

Not an expert at this by any means but I believe purchasing in the corporate name is harder then buying in your name and transferring. The difficulty lies within the financing aspect of it. If the financing is done with the corporation owning the home then the lender assumes liability in the event of the corporation defaulting on the loan and if the corp has no assets then the lender is s.o.l. I would imagine if you add some sort of personal gaurantee behind the corp then the lender would be more open to letting financing be done in the name of the corp.

Again, guys like surveyor and multipleprop are better suited to answer your question.

Without ever trying it my guess would be to buy in your name and transfer it into the llc after. Then repeat for each property with an assumption you will setup a corp per rental. That would maximize your liability.

[SD Realtor]

Not an expert at this by any means but I believe purchasing in the corporate name is harder then buying in your name and transferring. The difficulty lies within the financing aspect of it. If the financing is done with the corporation owning the home then the lender assumes liability in the event of the corporation defaulting on the loan and if the corp has no assets then the lender is s.o.l. I would imagine if you add some sort of personal gaurantee behind the corp then the lender would be more open to letting financing be done in the name of the corp.

Again, guys like surveyor and multipleprop are better suited to answer your question.

Without ever trying it my guess would be to buy in your name and transfer it into the llc after. Then repeat for each property with an assumption you will setup a corp per rental. That would maximize your liability.

[4plexowner]

sduuuude – this is one of the major loopholes with Prop 13 – commercial real estate is rarely re-assessed for tax basis because the property is sold inside the corp and, for tax purposes, did not get ‘sold’

being unable to increase the tax basis on existing commercial real estate is one of the motivations for cities to approve more strip malls, housing tracts, etc – new construction means new tax income at the current tax basis

result is urban sprawl

[4plexowner]

sduuuude – this is one of the major loopholes with Prop 13 – commercial real estate is rarely re-assessed for tax basis because the property is sold inside the corp and, for tax purposes, did not get ‘sold’

being unable to increase the tax basis on existing commercial real estate is one of the motivations for cities to approve more strip malls, housing tracts, etc – new construction means new tax income at the current tax basis

result is urban sprawl

[4plexowner]

sduuuude – this is one of the major loopholes with Prop 13 – commercial real estate is rarely re-assessed for tax basis because the property is sold inside the corp and, for tax purposes, did not get ‘sold’

being unable to increase the tax basis on existing commercial real estate is one of the motivations for cities to approve more strip malls, housing tracts, etc – new construction means new tax income at the current tax basis

result is urban sprawl

[4plexowner]

sduuuude – this is one of the major loopholes with Prop 13 – commercial real estate is rarely re-assessed for tax basis because the property is sold inside the corp and, for tax purposes, did not get ‘sold’

being unable to increase the tax basis on existing commercial real estate is one of the motivations for cities to approve more strip malls, housing tracts, etc – new construction means new tax income at the current tax basis

result is urban sprawl

[Author]

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