I HAVE A C-corp in a retail business, I want to dissolve. Can I use the retail corporation to buy or hold real estate, without setting up another enitity.
yes. but beware how the C-corp is taxed and how this relates to your being able to get money out of the company. Also beware of any outstanding tax issues you’re dragging around from the retail business. Since the corp is intact, these continue with the company into the new business venture.
sure. but it works out better to create and hold properties in a LLC.
the way that taxes are handled being the main issue
The main benefit to a c-corp over an LLC is that you can take out money without paying taxes via benefits programs. This set up only works if the company generates excess cash to fund the programs.
When the major activity of the C-Corp is holding rental property, isn’t the C-Corp a personal holding company with a prohibitive tax rate on its income?
You should avoid using the C-Corporation to hold property long term. C-corporations do not benefit from long term capital gains (currently 15% tax bracket on investments assets held for more than one year). LLC’s taxed as either a partnership or disregarded entity is the preferable choice.
okay thanks, sorry took so long to reply. :cool