Can Canadians buy RE in the U.S. without a visa?
I am a Canadian Investor and I would like to buy RE in the U.S. However, I have some concerns about your immigration laws.
I know several investors who are investing in the U.S. without a visa. Strangely, INS Officers don't seem to have any credible answers, as they kept contradicting themselves with their information. Some say you need a L1 Visa, a Trader Visa and/or others.
I don't require a Visa because I'm not crossing the border when purchasing RE.
Under what act are Canadians/Foreigners allowed to buy RE in the. U.S. without a visa? Who do you believe would you have an answer?
Thanks,
Oskar
Oskar:
The reason why you were getting conflicting answers is it depends on your level of activity. If you buy and sell U.S. real estate in your own name and do it regularly, you will be considered to be in a trade or business in the U.S. In that case, you DO need a Visa.
However, if you are a passive investor, you do NOT need a Visa. However, you should watch out for the tax laws, because if you are considered a "nonresident alien" under U.S. tax law the rent and gains on the sale can be subject to special withholding taxes under our FIRPTA laws under Section 897 of the Internal Revenue Code.
However, if you are physically present in the U.S. for more than 183 days a year (or more than 122 days a year, each year for 3 consecutive years), you will be considered a resident alien for tax purposes and taxed like a U.S. person.
You may want to use an LLC for investing in U.S. real estate or try the Novia Scotia LLC. Have you tax advisor explain how to use the U.S.-Canadian income tax treaty and those LLCs to save some taxes and lower your worldwide effective tax rate. I would explain it here, but it cannot be explained in a couple of sentences (nor a couple of paragraphs).
Taxjunkie
P.S. I live in a border state and have many Canadian clients that invest in U.S. real estate.
Taxjunkie,
I appreciate your feedback. Let say that I have two U.S. Corporations. One for flips and the other for buy & hold. These transactions are all done in my companies name. Does this fall into the Trade Category? Where is it stated in the immigration act that I need a visa for buying RE?
Oskar