USA Forming an LLC Partnership + Changing membership interest


Joined
Mar 18, 2013
Messages
2
Reaction score
0
I am an Australia investor looking to buy property in the States. In order to do this I need to form an LLC as I am a non-resident. The problem I am facing is that I am unsure whether to own the LLC as an individual or from an Australian trust.

There are advantages and disadvantages to both that I am aware of;

1) As an individual the taxable income margin are more favourable.

2) As a trust, its taxed very high, however in Australia I can use the distribute income to low income family members and pass on my assets without being subject to capital gains penalties.

If I have myself as an individual and my trust own a share in the LLC, say 95% individual and 5% trust ownership. Then in the future change the ownership to a different percentage say 50-50. Will the 'individual i.e myself be subject to capital gain taxes?

I have had multiple accountants tell me vague things.But I am not sure they know what they are talking about.

I guess what I am saying is can the 'individual' give part of his share to the 'trust' rather than selling it and having capital gains issues. If so, how would you get around this? Could it be written into the operating agreement to allow for this in the future?

Thanks in advance I appreciate your comments.
 
Last edited:
Ad

Advertisements

Joined
Mar 18, 2013
Messages
2
Reaction score
0
That's fine I have got the answer from a CPA

"There is no problem changing membership percentages later on between the members. We just don’t want to do it at will, just a few times as needed over the years. We would just make the capital accounts change so the percentages turn out to what you need them to be later on, which may be by distributing some of the prior taxed capital to the partner you want the ownership to go down and then the other partner keeps their capital, thus raising their percentage of ownership in the LLC. There will be no capital gain triggered since both owners will still own the LLC, no ownership interest is being sold to an outside person."
 

Ask a Question

Want to reply to this thread or ask your own question?

You'll need to choose a username for the site, which only take a couple of moments. After that, you can post your question and our members will help you out.

Ask a Question

Top