| With the stock market the way it is these days, people | | | | the opportunity to transfer the ownership interest |
| are looking for different places to invest their money | | | | without triggering local transfer taxes in some cases. |
| and one of those places may just be real estate. I | | | | There are several types of corporations you can form |
| know I know, we're coming through, and in fact are still | | | | including a C. corporation and an S. corporation. |
| in the middle of, one of the worst recessions in the | | | | Because an S. corporation allows profits to flow |
| history of America that was fueled primarily by a huge | | | | through to you as an individual, many investors prefer |
| bubble in real estate investing... | | | | this method but check with your accountant and tax |
| But the fact of the matter remains that prices on | | | | lawyer first just to be sure. |
| many property investments are dropping dramatically | | | | The next type of ownership is partnership ownership. If |
| because of the recession which means that it may be | | | | you have several investors going in together to |
| time to start looking to get back into the real estate | | | | purchase as one, than a partnership may be the right |
| game. | | | | ownership entity for you. Partnerships are usually not |
| If you are new to this game then you have come to | | | | treated as separate taxable entities but instead allow |
| the right place because today I want to talk about | | | | everything to flow through to the individual including |
| several different ways of investing in it and I wanted to | | | | profit and losses. |
| specifically talk about the different types of ownership | | | | Finally, another type of ownership is trust ownership. |
| that you can come to expect. | | | | Many states allow the creation of trusts that operates |
| How you own your investment is important for a | | | | solely to title these specific types of investments. In this |
| number of reasons including tax purposes, as well as | | | | case the trust may not be treated as a taxable entity |
| professional liability (what happens if a tenet in your | | | | but as a pass through entity sort of like a partnership. |
| rental house slips and sues you?!). Today I will discuss | | | | This kind of entity may not be for the average |
| several ownership entities that you can choose from. | | | | investor as it can be a little more complicated in certain |
| The first type of ownership is simply individual | | | | circumstances. |
| ownership. In this case, all the profits and liabilities flow | | | | However you choose to own real estate whether as |
| directly to you as an individual but you are also | | | | an individual or with your own Corporation or through a |
| exposed to the greatest risk. | | | | partnership or a trust, make sure that the underlying |
| The next type of ownership is corporate ownership | | | | real estate investment is sound and the potential for |
| which allows you to limit your liability and also gives you | | | | profit is large enough to make it a good investment. |