To bring or not to bring rental under S. Corp.?
In the next week I may be purchasing a rehab, incorporating ( I've been told an S. Corp. is best for the type of REI business being anticipated) and gearing up to go full time in "my business".
For tax purposes, should I transfer ownership of a rental property (single family house) and its bank account into the new corporate account or leave in my name as it has been? Currently it has its own account in a separate bank so all tranfers of funds are well documented. And we have another banking relationship started.
I would suggest keeping all retal properties separate from personal properties. You can do that by holding them all under the S Corp. A C corp is often double taxed, so that is not as advantageous. YOu should for tax purposes keep separate books for each retal property. Holding the rentals in the S corp will limit your liability substantially, so if your lender will allow this, you probably should. You can use one bank account for all retals, but keep separate the books for each one. Your CPA will thank you for this.