Tennessee Excise Tax and Franchise Tax (Tenn. Code Ann. § 67-4-2007 and Tenn. Code Ann. § 67-4- 2104)


When purchasing commercial real estate, it is common, for tax and liability reasons, to form a single purpose entity to own the property. Many times, the entity that is formed is a limited liability company. Forming an LLC is generally relatively cheap, fast, and shields the members of the LLC from liability.  However, when forming an LLC in Tennessee, or any other entity that provides limited liability to owners there are tax implications to consider that may not arise in other states. Tennessee does not collect income tax from individuals on most forms of income. Instead of imposing income taxes, Tennessee imposes various other taxes, including two forms of taxes for the privilege of doing business in the state. In Tennessee an excise tax and franchise tax are imposed on corporations, subchapter S corporations, limited liability companies, professional limited liability companies, real estate investment trusts, limited partnerships, and registered limited […]

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Seven Things to Consider When Buying a Triple Net Property


Purchasing a property with single tenant triple net lease (“Triple Net Property”) is a common investment tool for investors seeking a passive stream of income. Triple Net Properties can be a great investment for both sophisticated real estate investors and people who are new to the real estate investment world. Regardless of your experience level, when looking to purchase a Triple Net Property, there are a number of factors to consider.   The Creditworthiness of the Tenant. In the short term, the creditworthiness of the tenant is one of the most important factors when considering whether to purchase a Triple Net Property. When purchasing a Triple Net Property, you are generally purchasing the property for the steam of income generated by the rent under the lease. A creditworthy tenant is more likely to make timely rent payments, ensuring the Property has a constant payment stream.  Generally, publicly traded companies are […]

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