Buying real estate as S Corporation

[nick71]

What is the name of your state (only U.S. law)? California
My post didn't publish earlier for some reason.
I own a S corp with my sibling, each holding 50% shares. There is an opportunity to buy a building for our business and I'd like to know the pros and the cons (legal, tax, etc). of buying as an S-corp vs buying it under our own individual names. We're paying cash so there is no issue of borrowing money.

 

[FlyingRon]

A corporation can buy real estate, the hard part is getting anybody to finance it.

 

[HomeGuru]

What is the name of your state (only U.S. law)? California
My post didn't publish earlier for some reason.
I own a S corp with my sibling, each holding 50% shares. There is an opportunity to buy a building for our business and I'd like to know the pros and the cons (legal, tax, etc). of buying as an S-corp vs buying it under our own individual names. We're paying cash so there is no issue of borrowing money.

**A: are you paying cash? If not, talk to a mortgage broker about the mountains of paperwork required for a corp. real estate purchase.

 

[davew128]

Using a corporation to hold real estate is a VERY stupid idea. Since I'm not in magazine article writing mode at the moment, interested people can google exactly why that is.

 

[HomeGuru]

I disagree and not into writing magazine articles either.

 

[tranquility]

I suspect you disagree because you don't prepare the tax returns of s-corps who hold real estate.

 

[FlyingRon]

It would depend on the details, but if the option is holding investment or income property by a single shareholder S corporation versus just holding it directly in your name, the benefit eludes me. It makes it harder to finance, actually potentially worse tax treatment, as well as hardly any liability benefit.