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How you acquire title to your U.S. real estate is the most important decision you make. The name on the deed will drive your tax results, liability exposure, ease (or not) of inheritance, and other items
Tax
The name on the deed means you have identified the taxpayer. Different types of taxpayers (corporations, partnerships, humans, trusts) are treated differently for tax calculations. Or if the tax rates are the same, the paperwork will be different, and less paperwork is always better.
Getting the answer right on “Who is the owner?” will mean the difference between no estate tax upon death of the owner, or a massive (as much as 45%) tax.
Getting the answer right will make a gift of the real estate a tax-free event. Or not.
Liability exposure
The United States has a reputation for litigation. Rightly or wrongly, the reputation is there. As the owner of real estate, you will have some business risk and it only makes sense to limit that risk if you can.
The owner of the real estate bears the risk. The wrong choice could mean the difference between losing everything, or not. Buy good liability insurance, of course. But build firewalls, too.
Inheritance
Who will inherit your assets when you die? Your spouse? Your children? Transfer of real estate to heirs after death of the owner can–with pre-planning–be simple, cheap, and fast (a few weeks and a few hundred dollars). Or it can be expensive and time-consuming (months leading into years, and thousands of dollars).
Your choice.
Don’t hold real estate in your own name!
Make a good decision now by knowing what happens later
The way you answer the question “Whose name will be on the deed?” is by knowing the tax and business factors, and balancing them so you come to a good solution for you.
That’s the purpose of this book.
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