Posted by JHyre in Ohio on January 08, 2003 at 07:46:28:
I would use an LLC to hold properties in MD. The depreciation should flow through the S-corp UNLESS your properties are highly leveraged and you incur net losses…at that point, S-corps are usually MUCH more limited than LLC’s…this because LLC’s get full “credit” (to basis) for leverage, while S-corps are quite limited in that regard. S-corps are often good for flips, but have the described limitation (among others) for rentals.
John Hyre
assets in s corp to limit personal taxes is it ok? - Posted by welke md
Posted by welke md on January 06, 2003 at 17:24:02:
My wife and I make significant dual income with very few tax write offs (our house only). After extensive research we have decided on real estate as our primary investment vehicle. After consulting our CPA, we formed a s corp. He said the flow thru taxation is just what we are looking for to help us reduce our taxes on our personal income. Now after further research, I have come to realize that depreciation of our real estate will not be allowed to flow through the s corp and onto our personal return. Is this a true statement and if it is do I have a way around this delima. I meet the requirements of 750 hours a year actively pursuing REI. What if I formed LP with my corp and myself? Would that work?
Thank you for your help