How to Best Structure Your Real Estate Investments for the Long Term
Have you chosen to invest in real estate as a means through which to accumulate wealth in the long term? If so, part of that long-term plan likely includes considerations of your estate – in other words, how you plan to look after your family when you’re gone.
Is Your Estate Organized in Your Favour or the Government’s?
Take a minute to ask yourself:
- What will happen to my estate when I’m gone?
- How much of my hard earned money and accumulated wealth will be directly passed on to my family and beneficiaries?
- Have I structured my estate in the best way possible?
- To what degree will my estate be taxed upon my passing?
What You May Not Know
Depending on where the property is located, you are subject to pay certain taxes upon your death. For example, if you took advantage of the lucrative buyers’ market in Florida in the last few years, then your investment or vacation property may be subject to hefty taxes when you die. If you own the property under your personal name, your beneficiaries must pay tax on your investment, thus diminishing the amount of money they’re left with when you’re gone.
There’s a Smarter Way to Structure Your Real Estate Investment
When it comes to buying foreign real estate, either below the border or overseas, consider a corporate rather than a personal structure. Instead of owning property under your personal name, buy it under a corporation.
Why? Because a corporation is its own entity. This means that in the event of your death, the corporation survives – it doesn’t end with you. Your company – and your property – can go to your spouse, your children or any other chosen beneficiary without paying taxes. Since your corporation never dies, 100% of your investment remains protected.
The Importance of Planning Now
Even if you own property under your personal name today, consider transferring it under a corporation. The fee to do so is nominal and yet it will benefit your beneficiaries tremendously in the long run. But of course, planning today is essential. Make sure you have your estate in order while you still have the ability to make critical changes to your family’s advantage in the future.
Get the Professional Guidance You Need to Do It Right
Consider consulting a legal advisor to help you organize your investments and structure your estate to your greatest benefit today and that of your beneficiaries in the future. It’s worth it to take the time to work with someone who can help you make the most of the lifetime earnings, savings and investments that will survive you.