Are you considering holding your real estate in an S-Corporation?ย Think twice!ย ๐ค
While there are some tax benefits to holding real estate in an S-Corporation, significant drawbacks could hurt your bottom line.
Here areย five reasons why you should avoid holding real estate in an S-Corporation:
- Potential Built-In Gains Tax ๐
- Double Taxation on Sale of Property ๐ฐ๐ฐ
- Restrictions on Passive Income๐ซ
- Limited Transferability of Shares๐
- Higher Audit Risk ๐
Instead,ย consider holding your real estate in a Limited Liability Company (LLC) or a Limited Partnership (LP)ย to take advantage of their flexibility and avoid potential tax issues. ๐ข
At Palma Financial Services, Inc., we can help you navigate the complex legal landscape of real estate ownership and make the best choice for your specific needs.
๐ ๐Book a tax assessment with meย to learn more about your options for real estate ownership.