Hello
I'd appreciate some advice regarding my Australian Hybrid Trust.
I lived in the USA about ten years ago (California) so have a social security number, US bank account and credit history.
I'm thinking about purchasing some cash flow positive properties in the USA and am wondering if I can purchase these properties via my Australian Hybrid Trust. Obvioulsy I wish to do this so I can pay the net income to my wife, children etc as they are on a lower tax bracket.
Any comments or help would be much appreciated
Kind Regards
Patrick
I decided for the 3 us properties I have that for now owning them through an oz discretionary trust is more trouble than it’s worth. I’ll probly net about 5-10k per year max after repairs, deductible travel expenses, interest etc. It’s not worth setting up a trust to income split for that sort of money. If I grow my portfolio over there as is the plan, then I’ll look at other tax options. Not to mention the downsides of the trust make it less beneficial eg losses are trapped in the trust and can’t be passed onto unitholders. Also cap losses are trapped in the same way.
There’s more important concerns when setting up us prop investments. Namely – getting good property mgmt, llc setups, insurance and tenants!
Good luck.
Josh
Thanks Josh. It sounds from your post that it is possible to purchase US properties via a Hybrid Trust. I agree that is wouldn't be worth it to set up a trust solely to purchase a few properties – but since I already have the trust set up, I may as well use it.
pbod wrote:Thanks Josh. It sounds from your post that it is possible to purchase US properties via a Hybrid Trust. I agree that is wouldn't be worth it to set up a trust solely to purchase a few properties – but since I already have the trust set up, I may as well use it.Make sure you have the right structure set up in the US. There are all sorts of taxes to consider including capital gains and income tax. There are also state specific taxes that may impact on you if and when you sell. Also be aware of the need to protect yourself from litigation. Have you considered the tax advantages of owning an offshore business and what structure would work best to optimise those opportunities?
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