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How to Incorporate Your Home

Terry Masters

The notion of incorporating a piece of real property is a bit of a mischaracterization. You would not, technically, incorporate the property itself; you would set up a corporation, perhaps named after the property, and transfer the deed to the property to the new corporation. The corporation would own the property, and the person who used to own the property would now own the corporation.

Incorporating a piece of real property follows the same procedure as incorporating any business.
  1. Pick a name for the corporation that will own your house. Sometimes, a house sits on a farm and the owner will call the corporation "Apple Farm, Inc.," or the owner will use the address of the house as the name of the corporation, as in "100 XYZ Street, Inc." You can use any name as long as it complies with two basic requirements for incorporation: the name has to be a unique business name in the state where you choose to incorporate and the name has to include an appendage that lets the public know that the business is incorporated, such as adding "incorporated," "inc." or "corporation" to the end of the name of the business. Each state maintains a business entity database on the same website where information on incorporating can be found where you can run a search to see if the name you've chosen is already in use.

  2. Pick a state in which to incorporate the new business. Technically, you can incorporate in any state, however, it would likely be easiest to incorporate in the state where the house is located. Each state has its own corporation statute that outlines the procedure for incorporating. All states require that articles of incorporation (sometimes called "certificate of incorporation" or "charter") be filed with a state office, usually with the secretary of state, to start a corporation. Every state maintains a website containing all of the information needed to incorporate.

  3. Download the fill-in-the-blank PDF version of the articles of incorporation provided by your state. This template will be available on the state website, usually in the "forms and fees" section. This one- or two-page template will contain step-by-step instructions for filling out the form and filing it with the state.

  4. Fill out the articles of incorporation template. The state-provided template requests the minimum amount of information needed to properly file articles under state law. (Reference 2) You can add additional information, if needed, or draft your own articles entirely, but if you follow the state-approved format, you can be assured that your filing will be accepted with minimal hassle. (Reference 2) The template will differ from state-to-state but will request a combination of certain standard information, including the business name, name and address of a registered agent, number and value of the initial authorized shares of stock, and the name and signature of the person filing the paperwork (the "incorporator"). (Reference 2)

  5. File the articles of incorporation with the appropriate filing fee with the state. The template will contain instructions that will indicate where the articles need to be filed, whether the state accepts a filing method other than by mail (for example, by fax or electronically) and the fees associated with filing. Your business is incorporated as of the date the state accepts your filing.

  6. Quit claim the deed to your house to your new corporation. If the house has a mortgage on it, you may have to obtain permission from your lender to transfer title in the house to the corporation. The lender might require you to pay off the mortgage and take out new financing in the name of the corporation. The ultimate outcome should be that the new corporation owns the house and you own all the stock (100 percent ownership) in the corporation.

  7. Tip

    The transfer of property from an individual to a corporation can have tax consequences. Consult an accountant or a tax attorney for guidance. There are other entity types, such as the LLC, that can be easier to form and maintain if you want to incorporate a business to hold one piece of property. Check with an attorney or real estate expert for advice. Transferring property to a corporation should have the benefit of protecting the property owner's other assets from any suit or claim against the transferred property. However, the deed for the property must be placed in the name of the corporation in order for the protection to be effective. If you have a mortgage on the property, make sure you check with your lender to verify that the lender will allow you to change title in the property. You will waste time and money setting up a corporation if the lender refuses your request on the back end. Consult a real estate attorney for guidance.