How to overcome the issues facing foreign investors?
- Retain a real estate management firm to physically manage the property.
- Creation of a Limited Liability Company (LLC) with the State of Michigan to be the
“legal owner” of the investment property.
What is an LLC? A LLC is a legal entity that offers the liability protection of
a corporation with the tax treatment of person and/or partnership. This avoids “double
taxation” of a corporation.
An LLC can have up to 99 Members and the members can be individuals, partnerships,
corporations, trusts and other legal entities.
A LLC can own the property, operate a bank account, transfer the property without
a deed, have utilities turned on/off in the name of the LLC and in general simplify
the ownership process of US real estate for a foreign investor.
If there is any liability associated with the ownership or operation of the property
the “member(s)” exposure is limited to the assets owned by the LLC.
If operated correctly there is no personal liability for the members of the LLC.
An LLC is issued a tax identification number which can be used in lieu of a Social
Security number to open bank accounts etc.