US Entity structure for Canadians

[Hai Loc]

I would like to hear thoughts from Canadians how they set up their entities in the US and why they decided on certain structures based on investment/exit strategies. 

I have seen LLLPs used, LP used, LLC owned by C-Corp owned by Canadian Corp and I have seen personal name with added insurance.

I am planning to restructure all my entities and my decision will be based on research that I will be conducting on my own plus some help from high end professionals.  

I prefer not to hear "seek professional advice" on this thread. Just thoughts... I have taken professional advice on this spectrum in the past and for the most part it was not the best.

[Michael Bird]

@Hai Loc

Disclosure: I am not a lawyer or tax advisor, but simply a real estate investor. I have found the following through research based on MY situation. It MAY help others but I give no guarantees! ;)

I do not know if you have done the entity switch yet, but I would like to give my two cents...;) My spouse and I who are from Montreal, Quebec started with a Canada corporation and bought a duplex in Florida through it. Our accountant here in Montreal advised us that it was not the best option from a tax perspective so we had him do a full analysis (2019) of the best US entities from a tax perspective and he came up with three options. We took the three options to a US-based lawyer to give advise on the best of the three from an asset-protection standpoint. He chose one of them (with slight modifications) and that is what we went with...

To make a long story short, we are now using a Wyoming Limited Partnership to hold the properties with a Wyoming LLC as the 1% General Partner. At the time of this writing, my spouse and I are 99% Limited Partners. The property(ies) are to be held by the Limited Partnership.

We chose Wyoming for its strong asset protection laws and no corporate or personal income taxes. Florida also has no personal taxes which is also great! CRA can consider our LLC as a corp which is fine as it only has 1% of income and expenses which are generally written off by adminisrrative fees.

At the moment all is well but we have one more hurdle to overcome: refinancing our duplex (as it was paid cash) and financing further purchases. I have had a number of mortgage brokers tell me that, with a domestic US entity, they would consider us. I have touched base with them and am currently waiting for a response.

I hope this helps!