Foreign capital used in fund deals purchased with LLC

[Morgan Madill]

Hey BP,

I’m looking to hear other investors experiences regarding receiving foreign investor’s capital to purchase real estate investments here in the US. Have made connects with people on work visas in the US looking to deploy capital coming out of Saudi Arabia and India.

I'm wondering about the legal and tax situation that would incur by bringing in these foreign investors capital into an LLC which is going to use the BRRRR/Buy and Hold strategy.

I realize will have to turn to an international law attorney, but I would really like to hear an investors experience on this topic.

Thanks BP!

[Lance Lvovsky]

If you will have foreign investors investing in your deals, and contribution capital to your LLC/Partnership, there will be additional tax filings the LLC will need to consider, namely Forms 8804/8805, and requirement for you to withhold quarterly on income sourced to your investors. You will want to work with a tax advisor to ensure you are in compliance. Your investors may also need assistance obtaining a tax ID (ITIN) from the IRS, which a tax advisor can assist with. Your investors will also need to file a federal individual income tax return, and possibly state returns as well, based on which state you are operating in.

Again, a good CPA can guide you and your business to ensure you are in compliance.