An S corporation, C corporation and a limited liability company (LLC) can all buy real estate, and these business entities shield your personal assets from business losses or lawsuits.

Can a corporation be an individual?

A corporation is a single entity which may be comprised of individuals or a company, but is separate from its owners.

Can you put a house in a corporation?

You can’t transfer your real estate property, or any other personal property, into your LLC or corporation until you’ve actually formed a new legal entity. Typically you’ll need to register a business name and file the LLC or corporation paperwork with your secretary of state’s office.

When to put real estate in a S corporation?

Any course of action by S Corp owners will result in tax on the real estate in an S corporation, directly or indirectly, at the time of the transaction (sale of the business including the real estate, sale of the real estate separately, distribution of the real estate to the shareholder owners).

What happens when a corporation owns real property?

Unfortunately, the same cannot be said when a corporation owns the property. Of course, the corporation, itself, can withdraw the increased equity from its RP through a refinancing without tax consequences. However, what happens when the corporation then distributes this cash to its shareholders?

When do you have to sell a company to buy a property?

In such a case, the property may have to be sold first with corporation tax payable on the capital gain and income tax paid when the money is extracted from the company prior to the sale. More likely, the purchaser may not want to buy shares in such a company at all, and may insist on an asset purchase instead.

Why is owning real estate in a corporation’s name not a good idea?

Start for Free. Owning real estate in a corporation’s name is not a good idea from both a tax and liability standpoint. A regular C corporation is not a pass-through entity. Corporate taxable income is initially taxed at the entity level (the corporation pays taxes).