Background. Whether your1 investment in U.S. real estate is intended for personal use – that is, the property will be used by you and your family exclusively as a personal residence (perhaps also made available on occasion to friends and extended family gratis); investment use – that is, held as an investment property, rented to unrelated third parties; or for both personal and investment use, you will want to be aware that its ownership could subject you to U.S. tax.

Advance planning for the purchase and ownership of U.S. real estate can help minimize the U.S. tax consequences. The purpose of this article is to provide an overview of the applicable U.S. tax implications and to introduce structures that may help minimize them. You are advised to seek experienced tax counsel in connection with your transaction.