Why buying property for your kids can backfire
It sounds like a smart headstart, but purchasing investment properties in your own name for your children can trigger costly tax consequences, limit flexibility and ultimately undermine the very financial security parents are trying to create.
There can be advantages to buying property for children later rather than earlier that eclipse the capital growth potential of the property. (Image source: BearFotos/Shutterstock.com)
There is something deeply protective about parents wanting to buy investment properties for their children.
Many parents have worked hard, learned the value of property, and assume that securing one good home for each child will set them up financially.
The intention is admirable. But viewed through a tax-planning and estate-planning lens, the priorities quickly shift back to the parents.
Tax planning objective
When parents bring us this stra…
