Multiple LLc's Or Corporation Or...
I am a begginning REI and I am doing some deals with a partner and some deals on my own. For the ones with a partner I will be using a multi-member LLC and placing the properties in a land trust and having a business bank account in the name of the LLC. I planned on doing it this way for asset protection and tax reasons. For properties that I do on my own does it make sense to create a single member LLC with another business license and business account or is that overkill or does an S-corp fit in here better? Lots of questions, appreciate any advice
Try to quantify the costs and benefits of an LLC if you are optimizing the tax and liability aspects. You might find that the risks you will be better addressed with a different structure.
I am assuming you have liability coverage with an umbrella policy.
If you think of a car you want insurance but you do not want to pay so much that you could have bought the car for cash after a few years of premiums. Using a complex structure that is more hassle and higher costs then something simpler may not be the best way to provide the protections you seek.
John
[addsig]
I do a Delaware S Corp for flipping and a Nevada LLC for properties that i hold.
Both are really cheap to set-up.
Quote: Try to quantify the costs and benefits of an LLC if you are optimizing the tax and liability aspects. You might find that the risks you will be better addressed with a different structure.
Can you elaborate? Why would I not want to use an LLC? I read somewhere that if you did not anticipate your profits to be above $24k that an LLC was fine, I don't know why that number, any ideas?