Purchasing with a JV Partner - Articles of Incorporation

[Nir]

Hi,

Another basic JV question from me:

When purchasing with a partner where my corporation is on title should I present the Articles of Incorporation to my business partner? I think yes and have no issue with that. just not sure if that is the norm and if the "Articles of Incorporation" is the right document(?)

THANKS.

 

[Thomas Beyer]

QUOTE (investmart @ Nov 10 2009, 04:41 PM)
Hi,



Another basic JV question from me:



When purchasing with a partner where my corporation is on title should I present the Articles of Incorporation to my business partner? I think yes and have no issue with that. just not sure if that is the norm and if the "Articles of Incorporation" is the right document(?)



THANKS.


Sure .. why not !



Is partner a voting or non-voting share holder ?



Who has voting control ?



Do you have a JV agreement or a USA (unanimous shareholder agreement) ?



Why incorporate ?



related discussions on corporation's pro's and con's for real estate:



http://myreinspace.com/public_forums/Real_Estate_Discussion/62-10292-54272-To_create_a_company_or_not.html#54272

 

[Nir]

Thank You Thomas for the quick response!

The partner is not related to the incorporation this way. I simply own 100% of the shares. The corporation owns 50% of the property and my partner owns 50% of the property under his own name.
Correction/clarification: my partner`s name (he does not have a corp.) is on title 100% and we have a Co-tenancy agreement showing he owns 50% of the property and my corporation owns 50% of the property (my corp is not on title). In addition to 50/50 ownership, agreement mentions something like "[my partner] acknowledges that he holds title to the property as bare trustee and nominee for and on behalf of the co-tenants, each as to his proportionate interest."

Why incorporate? well, considering other business I give my accountant and the fact I do a lot of the bookkeeping myself, I hope to pay closer to $500/yr than around $2-3K I saw you mentioned before. so.. why not?
perhaps other potential future savings I must admit I still don`t fully understand. see 3-tier cash flow model thread.

Regards,
Neil

 

[AndyLuchies]

Hey Neil, is the co-tenancy agreement something you register on title, or not?



QUOTE (investmart @ Nov 10 2009, 07:32 PM) Thank You Thomas for the quick response!

The partner is not related to the incorporation this way. I simply own 100% of the shares. The corporation owns 50% of the property and my partner owns 50% of the property under his own name.
Correction/clarification: my partner`s name (he does not have a corp.) is on title 100% and we have a Co-tenancy agreement showing he owns 50% of the property and my corporation owns 50% of the property (my corp is not on title). In addition to 50/50 ownership, agreement mentions something like "[my partner] acknowledges that he holds title to the property as bare trustee and nominee for and on behalf of the co-tenants, each as to his proportionate interest."

Why incorporate? well, considering other business I give my accountant and the fact I do a lot of the bookkeeping myself, I hope to pay closer to $500/yr than around $2-3K I saw you mentioned before. so.. why not?
perhaps other potential future savings I must admit I still don`t fully understand. see 3-tier cash flow model thread.

Regards,
Neil

 

[Thomas Beyer]

QUOTE (investmart @ Nov 10 2009, 05:32 PM) Thank You Thomas for the quick response!

The partner is not related to the incorporation this way. I simply own 100% of the shares. The corporation owns 50% of the property and my partner owns 50% of the property under his own name.
no need then to divulge your corporate details.

I trust that you are mindful that any gains will be taxable in the corporation .. and come out to you personally as either
a) employment income (taxable)
b) management fees (GST payable), or
c) dividends (loweest taxes to you personally, but no expense in corporation, thus higher taxes in corporation)

 

[Nir]

"no need then to divulge your corporate details."
Hi Thomas, why not? yes, the corp is not on title BUT as mentioned partner is signing a contract with the corporation, not me. so.. I thought of course he needs to see artciles if incorporation(?) thanks.

 

[bizaro86]

QUOTE (investmart @ Nov 11 2009, 02:42 PM) "no need then to divulge your corporate details."
Hi Thomas, why not? yes, the corp is not on title BUT as mentioned partner is signing a contract with the corporation, not me. so.. I thought of course he needs to see artciles if incorporation(?) thanks.


That seems like the type of detail that may be overkill, unless he specifically asked for it. I signed a contract with Rogers for my cellphone without seeing their article of incorporation, and in my job we regularly sign contracts with service providers without that documentation.

Michael

 

[Thomas Beyer]

QUOTE (investmart @ Nov 11 2009, 02:42 PM) "no need then to divulge your corporate details."
Hi Thomas, why not? yes, the corp is not on title BUT as mentioned partner is signing a contract with the corporation, not me. so.. I thought of course he needs to see artciles if incorporation(?) thanks.
he should know that you own it .. and that the company has the right to do such deals .. no more details required !!

 

[Nir]

QUOTE (AndyLuchies @ Nov 11 2009, 03:56 AM) Hey Neil, is the co-tenancy agreement something you register on title, or not?

Andy, good question. current I do not have a plan to do so. should I? thanks.

 

[Nir]

QUOTE (bizaro86 @ Nov 12 2009, 04:02 PM) That seems like the type of detail that may be overkill, unless he specifically asked for it. I signed a contract with Rogers for my cellphone without seeing their article of incorporation, and in my job we regularly sign contracts with service providers without that documentation.

Michael

ha ha, nice one. when my annual rent = Rogers annual revenue and millions know aobut me I will not have to show my articles of inc. too.

 

[bizaro86]

QUOTE (investmart @ Nov 13 2009, 03:14 AM) ha ha, nice one. when my annual rent = Rogers annual revenue and millions know aobut me I will not have to show my articles of inc. too.

Don`t forget us little people here when you`re all rich and famous!

Michael