All Forum Posts by: Natasha Rooney
Natasha Rooney has started 16 posts and replied 49 times.
Post: Tax Considerations for Canadians
- Posts 50
- Votes 36
Quote from @Chad U.:
Quote from @Natasha Rooney:
Quote from @Chad U.:
This is indeed a widely debated topic amongst many tax professionals and investors alike, and an entire novel could be written on the best method to use. There are many other things to consider besides income taxes including but not limited to: estate taxes, probate, liability protection, incapacity issues, witholding taxes on gross rental income/witholding taxes on sale of foreign property (known as Foreign Investment in Real Property Tax Act (FIRPTA)) and the list goes on. The fact of the matter is that no one's situation is really the same, so each person's ideal setup differs.
As to why LLC's don't work for Canadians, as explained in the articles, is that LLC's are double taxed when the income is brought back to Canada. The reason being is Canada Revenue Agency considers it a foreign corporation (not a flow through entity), and therefore a mismatch in foreign tax credits resulting in some cases of 70%+ taxation!
The most common approach to purchasing US real estate as a Canadian is by utilizing an US LLP or LLLP, with the investor as a 99% Limited Partner, and having another entity (such as Can Corp or US LLC) as the General Partner at 1% to limit liability exposure. Use of these entities in this manner allows for matching foreign tax credits, and when the money is brought back to Canada, you essentially pay income taxes at your personal rate. This structure is not cheap to setup initially, and the annual admin costs are substantial, however gives peace of mind that it offers the ultimate liability protection and most efficient tax structure.
The best advice is consulting a cross border tax specialist who also have a good understanding of US real estate laws and taxation. I can give some recommendations if needed.
10 years, wow time flies.
Reach out to @Elliott Milek, he may have some suggestions
Thank you!! :)
Post: Canadians investing in US - Toronto
- Posts 50
- Votes 36
Quote from @Linda Labbe:
we are also Canadians investing in the us. We invest in toledo and Detroit were we have found the returns to be great. More then willing to share what we have learnt and why these cities with anyone who wants to chat
Hello! I am just getting started with my US investing goals. As a fellow Canadian, I'd love to chat! Its a bit scary jumping into a new market and learning what to do and what not to do as a Canadian investor. I'll send you a message to connect!
Post: Canadians investing in US - Toronto
- Posts 50
- Votes 36
Quote from @Gloria N Gear:
Hi Alejandro, I just had a new client (investor) from Toronto drive the short 8 hour drive to Indianapolis this weekend to do some research of the area with me. I would be happy to connect the two of you and talk with you about my experiences with my other Canadian investors.
Hello! I am also a new Canadian investor looking to get into the US market. I'd love to connect and talk about your experiences with your Canadian investors :) Thanks!
Quote from @Ty M.:
Hello looking to break into the US market in 2024. I have 1 unit in Toronto Canada and want to look for opportunities across the border. If any one has experience with this it would help (Mainly the lending process) Toronto is a vibrant city with lots of renters but it’s also expensive and renters have more rights than landlords.
Hello! I'd be interested to connect with you. I am looking to get into the US market in 2024 as well. I'd love to hear about your experience if you've started. Thanks!
Quote from @Michal Liviatan Carpenter:
I am a US lender based in Toronto.
Feel free to reach out with any question. Good luck!
Hello! I'd love to connect, I sent you a message :)
Post: Hello! New Investor from Canada
- Posts 50
- Votes 36
Hello everyone!
I am a Canadian living in Calgary, AB, hoping to purchase my first real estate investment south of the border in the US this year!
Looking to connect with any fellow Canadians who have already been investing in the US to get some more detailed information.
I have already learned a lot from this site and am looking forward to being part of this community!
Thanks!
Post: Tax Considerations for Canadians
- Posts 50
- Votes 36
Quote from @Chad U.:
This is indeed a widely debated topic amongst many tax professionals and investors alike, and an entire novel could be written on the best method to use. There are many other things to consider besides income taxes including but not limited to: estate taxes, probate, liability protection, incapacity issues, witholding taxes on gross rental income/witholding taxes on sale of foreign property (known as Foreign Investment in Real Property Tax Act (FIRPTA)) and the list goes on. The fact of the matter is that no one's situation is really the same, so each person's ideal setup differs.
As to why LLC's don't work for Canadians, as explained in the articles, is that LLC's are double taxed when the income is brought back to Canada. The reason being is Canada Revenue Agency considers it a foreign corporation (not a flow through entity), and therefore a mismatch in foreign tax credits resulting in some cases of 70%+ taxation!
The most common approach to purchasing US real estate as a Canadian is by utilizing an US LLP or LLLP, with the investor as a 99% Limited Partner, and having another entity (such as Can Corp or US LLC) as the General Partner at 1% to limit liability exposure. Use of these entities in this manner allows for matching foreign tax credits, and when the money is brought back to Canada, you essentially pay income taxes at your personal rate. This structure is not cheap to setup initially, and the annual admin costs are substantial, however gives peace of mind that it offers the ultimate liability protection and most efficient tax structure.
The best advice is consulting a cross border tax specialist who also have a good understanding of US real estate laws and taxation. I can give some recommendations if needed.
Post: Tax Implications for CANADIAN investing in US real estate
- Posts 50
- Votes 36
Hello!
I can't seem to find straight answers anywhere (totally could be looking in the wrong spots - I'm new to this!)
What are the tax implications for a Canadian investing in US real estate?
My husband and I are Canadian and hoping to start investing within the next few months in US real estate. We have done research about the whole investing piece, however, trying to find straight answers about how taxes work for Canadians investing across the border.
Can someone with any experience with this please lay it out for us?
Thank you in advance!! Looking forward to being part of this community!
Post: Learning about investing! Canadian trying to invest in US real estate
- Posts 50
- Votes 36
Hello everyone!
This is my first post. I have been interested in investing in US real estate for quite some time and have spent the summer reading books and getting a bit more familiar with it all. I can't wait to purchase our first investment property as I know that is when we will really start learning how it all works. We are hoping to purchase a multifamily property by the end of the year. Just trying to sort out the details about how it all works as a Canadian.
I am just wondering if anyone can give me a basic overview about what its like as a Canadian investing in US real estate?
What are the tax implications? Are we taxed in Canada for overseas income as well as in the states? (double the tax?!)
Any input welcome!
Thanks in advance! Looking forward to being part of this community :)