Thanks for the info on PA tax system…government always gets their money somehow.
As far not using trusts, yes, they only keep the owner safe from prying eyes. Funny…a good buddy of mine
who had over 200 units always settled his cases when his tenants would sue for ‘cracks in the sidewalk’ etc like cases.
I’ve had a few of those…all of them going no where and costing me nothing. No atty would accept the case
without taking a large retainer upfront…that stopped all but two against me.
Those two never made it to trial as they knew they had no case - they bluffed the entire way and I called it.
A second (and perhaps to me, more important part) issue is I know every owner of every property I want to
know when it is in a corp. I just look up what the business name is/was/owner+partners
(property purchased as well in these names) and I have anything I want to know about them. Goes hand-in-hand with the first part too.
Went to a recent meeting and big big named guru said the ben of a trustee in PA must be recorded in Harrisburg. Who is working with trusts in PA and how long do you have to notify them? Do they send you paperwork or are there certain additional forms you complete?
I don’t know the costs to file a trust or the costs of the tax return, becuase I view most trusts as worthless, anonminity but no asset protection.
Corps and LLC in Pa. are subject to income tax as well as the Capital Stock Tax, which is one of the most onerous taxes ever designed.
If you sell a property (in a corp oir LLC) and have a $500,000 profit, the state calculations capitalize that as the corp or LLC having a worth of $5,000,000. In other words a 10% cap rate. Then the corp.LLC is taxed for the nest five years. The tax rate used to be 11.99% but is now lower. The tax was designed to tax a manufacturer who sells inventory but applies to selling real estate also. The tax has killed many a corporation and driven some to bankrupcy. What better asset protection than bankrupcy?
