To LLC Or Not To LLC
I'm just getting started(yet to buy) and am not exactly sure if I should be setting up an LLC or not. It's not gonna stop me form looking for deals, but I would like to know if I should be looking into that.
Also, not sure of a RE Attorney at this point.
As always, thanks in advance for the advice/info.
-Paul
Most of the people I have spoken with recommend an LLC. It confers the corporate shield of liability without the double taxation, though I have heard there is a franchise tax in some states (5.7something% here in Texas).
Filing fees vary according to state. Texas is among the higher priced ones at $200 plus a $25 name reservation fee. You should be able to do it on-line directly through your www.state.gov site and bypass the need for a lawyer. If you have a lot of assets to protect or need to incorporate estate planning into the overall strategy, you probably should get a lawyer.
Good luck!
Warren
Warren,
Good info. THANKS!
My partners and I aited until we had a couple of properties with some equity prior to starting an LLC. It was a personal choice, and we felt an appropriate business decision at the time.
It didn't make sense to us to spend the money and time to establish a business entity if we were only giving things a try. We waited until we were sure that this investing thing was what we were going to do for the long haul. You just don't need to do it if you're not doing anything.
Good luck,
Jeff
Knowlegejunkie,
You should probably get a few deals under your belt first, but always consult an attorney at least join prepaid legal. Another thing to remember is that once you form an LLC, you will need to pay a minimum of $800 in taxes in California to maintain your LLC. Of course once you completed your first few deals, $800 will be a drop in the bucket. Hope this helps.
Good luck. and let me know if I can be of any assistance.