LLC or LP when investing in USA?

Question

Should a Canadian use an LLC or LP as an business entity when investing in PA, USA?

Roy N. · Answer

Audrey,

It was the 1970s when I lived in the Brighton / Carrying Place area (not far from the canal), and I was quite young, so I do not know any attorneys or accountants to recommend.  I am sure if you find a local real estate investors association in Belleville or Trenton, the folks there will steer you in the correct direction.

Audrey Koerber · Answer

Thank you for your responses.  As a Canadian investor, who do you recommend as a good cross border attorney and accountant?

Roy N. · Answer

@Audrey Koerber

@Chad Urbshott gives you good advise, find yourself an attorney and accountant with cross-boarder experience ... preferably in real estate.

Canada does not have he equivalent of an LLC - essentially the simplicity of sole proprietorship with the benefits of incorporation - and the CRA will treat it as a foreign corporation {in almost all instances}.   This may, or may not, be an issue depending on what you are trying to achieve ... hence the need to meet with the specialists to get your organisation set-up to meet your current and allow or you future needs.

Chad U. · Answer

You should consult with a cross border legal and/or accounting specialist as to your best entity structure to use.  However, I will say that LLC is not recognized in Canada and deemed a foreign corporation, resulting in unfavorable tax treatment.  Let me if you need some contacts for cross border advice.