The choice of a name for a U.S. property depends on consideration of three major issues: asset protection, taxation, and inheritance.

Asset Protection

This is a condition to ensure the security of your property. Asset protection is especially important for some high-risk occupations and for people who are considering the risk of their children's marriage.

If your occupation has some risk of being sued by others or problems with marital changes, then you may not be able to give your assets some protection.

Tax Deductions

The main considerations are income tax, capital gains tax and property tax, as the different names can lead to different tax issues.

There is no denying that reasonable tax deductions are what every investor must seek, subject to the provisions of the tax law. So we can make the choice that is more favorable in terms of taxation when other conditions are not so important.

Passing on the fluidity

Real estate investment is the use of time to get rich with a portfolio of assembled real estate as a tool. Therefore, it is necessary to consider how to titling in order not to cause additional costs such as taxes during the vesting and inheritance of real estate in the future.

Types of titling

Personal name of owner-occupied house

As an owner-occupied house, it is more appropriate to write down your name from the point of view of tax benefits, which will be available for an owner-occupied house.

Therefore, most people who buy a house register it under their individual or joint names.

Advantages

Lower cost, simpler operation, and more control over the property.

In addition, the U.S. tax law provides that if the owner-occupied house has been lived in for 2 years within 5 years, there is a tax allowance for selling the house in the future when it has increased in value.

A tax exemption of $250,000 for one person, or $500,000 for a couple, is a significant benefit.

Disadvantages

When you personally encounter a lawsuit, the property in your name will be exposed to this lawsuit and be jointly and severally liable.

There will also be estate tax implications when you want to pass title to your children in the future, especially for non-U.S. citizens.

This is because the estate tax exemption for U.S. citizens is $11 million, compared to $60,000 for foreign citizens.

Corporate titling

If your home is used for investment purposes, such as renting, then you may be responsible for any harm caused by tenants in your home in the first place.

As unbelievable as it sounds, it is important to prepare in advance to avoid this risk.

If the value of the property is large, you may be better off putting the property in the company's name from an asset protection perspective.

Advantages

No matter what legal issues are involved with your house, the company will be liable first, which is a layer of protection for the house and yourself.

The company, as a legal entity and tax subject, has its own tax rate, so the profit and loss of the house is attributed to the company's profit and loss.

The succession of the company is also very simple, just fill out a form to declare the change of shareholders and directors.

Disadvantages

If you do not have a company beforehand and want to set up a company on your own initiative, you will need to incur some costs, such as attorney's fees, state taxes, accounting fees, etc.

The net rental income of the house and the capital appreciation income of the house are calculated according to the corporate income tax rate.

When the value of the property is not significant, you may choose to purchase insurance, such as umbrella insurance.

Umbrella insurance is an additional liability insurance policy used to pay for bodily injury or death, property damage and all legal actions against others in any unforeseen situation.

It is an additional protection for the victim against endangering the insured's personal property in the event of an accident.

Joint purchase of property

The joint assets are in the names of different people, so the assets will also go to those individuals.

In case of legal problems, they can all be traced back to this property which has no asset protection.

How much ownership is indicated in the percentage of ownership, the exercise of ownership is allocated in this proportion, and the proceeds are also allocated in proportion to the ownership.

Joint tenancy

Joint tenancy is a community of property rights where the title is automatically transferred to the other party upon the death of one party.

Generally, couples and family members choose this joint tenancy method.

General Community

General community is the joint ownership of property. Upon the death of one party, the property is transferred to the family of the deceased party.

Generally, non-marital partners will use this method of union.