Non-resident investing for US citizen child

4 Replies

Hi,

We are non-resident foreigners who are interested in buying a condo in Michigan for our son who is a US citizen (9). He will most likely live in the US in the future (for college etc.) 

How is the best way to reduce US taxes (especially capital gains and death tax) and eventually transfer the real estate to him? As we may rent it in the mean time, we were suggested to form an LLC.

Any advice or name of a competent attorney/tax person in Michigan would be very much appreciated!

Note: As we have ties to US and Michigan, we spend summers here as well, so this is not solely an investment. 

Good morning Ayse, forming an LLC is the best way to protect your personal assets from any contingency that may occur with your rental / vaca. property. I have a team of people that I work with and have found them to be honest and work very hard for my investments in the Ypsi / Ann Arbor area. Speak to Todd or Therese at Moving the Mitten real estate... they are a good starting point. Tell them Michael Ventura sent you there, that will speed things up for you. Good luck! Michael V

You could put it in a trust, capital gains is only relevant if you come to sell it. Taxes are just part of life in the US but get a good cpa.

I read that capital gains have a very little exemption for non-residents (60K on the sell price, while it is 1M? for US citizens). Otherwise being taxed on real profit is fine.

Join the Largest Real Estate Investing Community

Basic membership is free, forever.

By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.