Selling Your Real Estate Corporation

[UTCVenturesLtd]

Rather than to sell off properties individually, has anyone sold their corporations to another investor with the entire portfolio? Is that a good way to get into real estate as an investor? Or maybe to move up the property ladder with buying one?

Has any used a corporation to do a joint venture deal and then wind down the corporation or save it to do the next jv deal? Does the accountant take care of all of the details with winding down a corporation? What are the extra costs to do that?

If you have a corporation that is used to flip houses, and you sell your shares, would the shares not be capital gains even though the intent was to flip the houses inside the corporation? Maybe a way to flip houses, by flipping corporations???

What does one do to sell a corporation? Basically, the accountant takes care of the transfer of directors and the sale? Would you involve a lawyer on this transaction?

 

[Thomas Beyer]

QUOTE (UTCVenturesLtd @ Nov 30 2009, 04:43 PM) Rather than to sell off properties individually, has anyone sold their corporations to another investor with the entire portfolio? Is that a good way to get into real estate as an investor? Or maybe to move up the property ladder with buying one?

Has any used a corporation to do a joint venture deal and then wind down the corporation or save it to do the next jv deal? Does the accountant take care of all of the details with winding down a corporation? What are the extra costs to do that?

If you have a corporation that is used to flip houses, and you sell your shares, would the shares not be capital gains even though the intent was to flip the houses inside the corporation? Maybe a way to flip houses, by flipping corporations???

What does one do to sell a corporation? Basically, the accountant takes care of the transfer of directors and the sale? Would you involve a lawyer on this transaction?
yes you COULD do that .. but it is rarely done as the buyer has no real benefits.

You have to actually LOWER your price as the buyer gets a lower adjusted cost base, namely fom teh time you bought it minus depreciation.

Example: you bought an asset for $300,000 and now it is worth $400,000. You depreciated teh asset to $250,000. Even if the seller sold the asset a year later for $400,000 he has to pay taxes on a $150,000 capital gain, or approx. $40,000.

Thus, your share price has to reflect that.

Also, the buyer inherits any potential liability or taxes owing or GST owing, say from yoru sloppy return from 4 years ago.

Thus: unless there is a good reason to buy shares it is hard to sell them !