All Forum Posts by: Natasha Rooney

10 years, wow time flies. 

Reach out to @Elliott Milek, he may have some suggestions 

we are also Canadians investing in the us. We invest in toledo and Detroit were we have found the returns to be great. More then willing to share what we have learnt and why these  cities with anyone who wants to chat

Hi Alejandro, I just had a new client (investor) from Toronto drive the short 8 hour drive to Indianapolis this weekend to do some research of the area with me.  I would be happy to connect the two of you and talk with you about my experiences with my other Canadian investors.

Hello looking to break into the US market in 2024. I have 1 unit in Toronto Canada and want to look for opportunities across the border. If any one has experience with this it would help (Mainly the lending process) Toronto is a vibrant city with lots of renters but it’s also expensive and renters have more rights than landlords. 

I am a US lender based in Toronto.

Feel free to reach out with any question. Good luck! 

This is indeed a widely debated topic amongst many tax professionals and investors alike, and an entire novel could be written on the best method to use.  There are many other things to consider besides income taxes including but not limited to: estate taxes, probate, liability protection, incapacity issues, witholding taxes on gross rental income/witholding taxes on sale of foreign property (known as Foreign Investment in Real Property Tax Act (FIRPTA)) and the list goes on.  The fact of the matter is that no one's situation is really the same, so each person's ideal setup differs.  

As to why LLC's don't work for Canadians, as explained in the articles, is that LLC's are double taxed when the income is brought back to Canada. The reason being is Canada Revenue Agency considers it a foreign corporation (not a flow through entity), and therefore a mismatch in foreign tax credits resulting in some cases of 70%+ taxation!

The most common approach to purchasing US real estate as a Canadian is by utilizing an US LLP or LLLP, with the investor as a 99% Limited Partner, and having another entity (such as Can Corp or US LLC) as the General Partner at 1% to limit liability exposure. Use of these entities in this manner allows for matching foreign tax credits, and when the money is brought back to Canada, you essentially pay income taxes at your personal rate. This structure is not cheap to setup initially, and the annual admin costs are substantial, however gives peace of mind that it offers the ultimate liability protection and most efficient tax structure.

The best advice is consulting a cross border tax specialist who also have a good understanding of US real estate laws and taxation.  I can give some recommendations if needed.