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The Tic Tax Advantage

Form a partnership to invest in property.

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This story appears in the September 2006 issue of Entrepreneur. Subscribe »

Priced out of the soaring real estate market, but still want a piece of the pie? Real estate investors are turning to tenancies in common, or TICs, for the twin benefits of increased buying power and greater flexibility.

Under the TIC ownership structure, multiple parties can pool resources to buy property. The ownership stakes can vary, with any income produced or expenses incurred passing to the tenants according to their percentage of ownership. What's more, tenants retain the right to sell their interests at any point, says Craig Brown, vice president of Investment Property Exchange in Dallas, who explains that groups that form a limited partnership to invest in real estate have less flexibility.

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