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Author: Subject: Fideicomiso Questions
Beagle
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[*] posted on 6-7-2016 at 07:07 PM
Fideicomiso Questions


I've done quite a bit of research on this and still come across lots of conflicting info. So I'm going to give it a shot and throw it out here.

There are several questions and if anyone has any helpful experience with these, a million thanks!

We found a couple of lots in San Juanico in town that we'd like to purchase. We want to build a little casita on one and maybe down the line another on the other one. The lots are next to each other. (We are doing all of the DnD on the property).

One idea is to build the little house, and while still in the states, travel back and forth and to use for us and when not there, if we can rent it out…great. If we later built another and wanted to rent it out on Homeaway or VRBO or something…

--Should we do a Corporation or stick with the Fideicomiso? Do you have to do a Corp if you use the casita for rental income?

--Does anyone know if we can put more than one lot in the same Fideicomiso? I think it costs more for each Fideicomiso and want to keep the cost down.

I've seen tons of info going back to 99 on the different issues with filing the Fedeicomiso with the IRS.

--what's the latest with that? What do people do?

Trying to think if there were more questions but this is all that my poor brain can muster right now.

If this happens, I'm sure I will be peppering you guys with building and supply questions daily!!

PS- I used to live in Costa Rica and sold Real Estate there. I know that doing this in Latin America can be a huge pain if not done correctly. Just not experienced with the Mexico side of things. Glad the Nomads are here.

Any other helpful info is gladly welcomed!

Sincerely,
Beagle



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SFandH
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[*] posted on 6-7-2016 at 07:30 PM


If you want professional legal advice, contact this guy.

https://www.facebook.com/groups/534958289989059/

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BigWooo
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[*] posted on 6-8-2016 at 05:41 AM


I would go with a fideicomiso and forget renting. A fideicomiso is more expensive to set up, but in the long run it's much less expensive and less hassle. A corporation is a pain to maintain and requires hiring an accountant. The reason I say forget renting is that I know several people in San Juanico who have rented in the past and have stopped. The occupancy rate is very low (varies with the consistency of the surf), administrative costs to rent legally are high, and the wear and tear on your building just isn't worth it. I would seek out and ask those who rent (not the property managers) and get their opinions. Most I've talked to barely cover their costs and make very little, if any profit.

[Edited on 6-8-2016 by BigWooo]
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weebray
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[*] posted on 6-8-2016 at 07:09 AM


Get a fiedo and don't overthink your decisions. Commit and go. It will cost about $1000 to $1500 depending on your participation in the transaction. Any notario can handle lot line adjustments. Ask around for peoples opinions on a good one in your area.



"The reason it's called the American dream it because you have to be asleep to believe it."
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4x4abc
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[*] posted on 6-8-2016 at 01:10 PM


I highly recommend a Mex corporation
if you don't want to be hit with outrageous capital gains when selling, you will need to do some very detailed accounting of expenses in a Fideicomiso anyway.

Maximum property size for a Fideicomiso is 2,000 m2
each will incur the steep Mexico City fees
however, banks will hold as many Fideicomisos for the same annual fee as they would charge for one (well, you have to ask your bank for it)

Property size in a Fideicomiso can be in excess of 2,000 m2 when you can prove that you'll make a large investment with the next 5 years. US$500,000 will get you started. Designed for hotel, golf courses etc. But they will likely create a corporation anyway.

Depending on the community you might need permission to rent out your property/house. It can get into some deep doodoo if you don't. Don't listen to your neighbors telling you that they have never done it.

Consult a knowledgeable lawyer for creating your corporation. The structure (house) on your property has to reflect your business. And yes, SAT and INM will come to inspect your property after you are done building. They visited my house several times. If you don't have your corporation's name on the gate you are already in trouble.

PM me if you need the right lawyer for your deal.



[Edited on 6-8-2016 by 4x4abc]




Harald Pietschmann
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4x4abc
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[*] posted on 6-8-2016 at 01:22 PM


by the way, creating a corporation will make the immigration process a lot easier. Nobody ever will ask you for proof of income.



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AlanDow
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[*] posted on 6-9-2016 at 01:20 PM


Regarding your question on the trust reporting issue, that has finally been settled - the IRS issued a private letter ruling for one taxpayer that definitively said they did not have to file these forms related to their Fideicomiso. Then the IRS helped out all US taxpayers who have a Fideicomiso, by following up that private letter ruling with a “revenue ruling” that can be relied on by all taxpayers – IRS revenue ruling 2013-14 specifically addresses the Mexican Fideicomiso, and lists an example of a Fideicomiso that is used as a residence, and concludes this is not a foreign trust (and therefore no filing of forms 3520 and 3520A is needed).

Regarding your question on one Fideicomiso for two lots - I first did a lot line adjustment to merge my two lots into one larger lot, to avoid paying for more than one Fideicomiso (theoretically also saves on property taxes, however they were already so low, not a meaningful difference)
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Beagle
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[*] posted on 6-10-2016 at 03:56 AM


Ok, Thanks everybody!

That's all helpful info. Appreciate your time and energy in answering. This gives us some extra stuff to look over and ponder.

Muchas Gracias!
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[*] posted on 6-10-2016 at 01:19 PM


Do your due diligence with the local ejidos to make sure up front a fideicommiso can even be obtained for any property you intend to lease.

Answer first, then proceed cautiously; Whats the golden rule for investing in Baja?




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AKgringo
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[*] posted on 6-10-2016 at 01:31 PM


Quote: Originally posted by BajaTed  
Do your due diligence with the local ejidos to make sure up front a fideicommiso can even be obtained for any property you intend to lease.

Answer first, then proceed cautiously; Whats the golden rule for investing in Baja?


Ooh,ooh....pick me teacher, I know this one!

"Never invest more than you can afford to walk away from!"

That is also the guiding rule for the vehicles I drive off road down there!




If you are not living on the edge, you are taking up too much space!

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