Originally posted by Vikram C.:
The primary advantage of a DE LLC is not aasset protection but that DE has a much greater depth of case law on corporate matters than most other states. This makes it possible for your lawyer to give you better legal advice than for, say, NV or WY. In addition, most corporate lawyers in big law firms will be experts at the corporate laws of their state + DE, while few corporate lawyers outsite NV and WY will be experts at those states corporate laws.
Elle, regarding a foreign investor, you can get a loan from a foreign investor who is unrelated to you. See a good corporate lawyer and tell him that you are interested in a "registered portfolio debt." This allows you to pay interest to the foreign investor and deduct the interest payment as a business expense while the foreign investor will not be subject to U.S. income taxes on the interest paid. (You can also have the foreign investor be an equity owner in the business but they will then be subject to withholding on their distributive share of the income.)
Hello Vikram,
I am having the same questions here but somewhat different.
My goal is to buy REO to flip. I am a RE agent, so I am still researching about the best way to buy my first flip. Should I do in my own name or an LLC, if the latter, then should I create one in DE vs where I live, say FL?
Also, the money will be coming from my father. He lives overseas but has opened a bank account in his name here in the US and has transferred money to it. I am supposed to use that money to purchase property and the flip it. I am not sure how to do this. He basically is giving me that money and does not need me to pay him back. But I have to decide how to conduct business using that money that is sitting in his bank account here in the us.
1) Should I just transfer the money to my personal account and buy the homes in my name or LLC?
2) Should I loan the money from him and create loan docs and pay him a rate and after every flip put the money back in his account and the profit in my account?
3) Since he is not a US citizen, what happens to the money if I pay him interest deposited to his account here in the US, is it taxed? What if I wanted to just transfer the money to my account, am I taxed on it ? I am just starting to research this arena and all help will be greatly appreciated.
Thanks
