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Tax Implications for Funding One Entity With Another
Hello, my name is Naomi. I am new to posting but have enjoyed the community for some time.
I am considering purchasing an investment property (US land) where I will eventually build a vacation home that also generates rental income when I am not there. I am self employed as a consultant. I am wondering the most tax advantageous way to structure my entities (I would be the sole owner of each).
For example, the consultancy entity operates at a profit but the property investment entity will, at least at first, operate at a loss (construction expenses, etc.). Is there a way to have this profit and loss offset each other, thereby minimizing the taxes?
I'm wondering if my consultancy should be set up as a C-Corp, thus taxed at the corporate rate, and I could then loan funds to the Investment Property (which I assume would be an LLC)... Is this feasible, or is there a better, simpler way to do this?
Naturally I intend to consult with a lawyer and CPA, but I want to have a better understanding of the pros and cons and prospective plan before sitting down for discussion.