Form an LLC for rental business?

Sam · Joined: 27 Feb 2008 Posts: 1

Currently I own two homes in my name and hopefully I will be
purchasing a third soon, the first two homes are being rented and as I
move forward I intend to continue purchasing homes for investment/
rental purposes on a very small scale. I think at the most I would
like to have 10 homes, more likely I will end up with 5 or 6.

Below are my questions

Would it be appropriate to form an LLC for this type of business?

How would I transfer my current homes that are owned in my name into
the LLC?

Where can I go to learn more about the advantages and disadvantages of
forming an LLC, specifically in regards to taxes and personal
liability?

Thanks

Sam

--
>
>
>
>
>
>
>
>
>
>

Archived from group: misc>taxes>moderated

Stuart Bronstein · Joined: 25 Aug 2007 Posts: 561

Sam wrote:

> Currently I own two homes in my name and hopefully I will be
> purchasing a third soon, the first two homes are being rented and
> as I move forward I intend to continue purchasing homes for
> investment/ rental purposes on a very small scale. I think at the
> most I would like to have 10 homes, more likely I will end up with
> 5 or 6.
>
> Below are my questions
>
> Would it be appropriate to form an LLC for this type of business?

>From a liability standpoint it might be. Actually if liability is
your issue, you should probably use a different LLC for each
property. A good insurance policy is better, though, if you need to
choose.

>From a tax standpoint an LLC gives you the greatest flexibility,
because you can choose it to be taxed as a proprietorship or a
corporation (including an S-corporation). Talk to your tax advisor
about which would be best in your situation.

> How would I transfer my current homes that are owned in my name
> into the LLC?

A deed should work. You should also document that the transfer is in
exchange for an interest in the LLC. Check with your tax advisor to
be sure the transfer complies with section 351 of the Internal
Revenue Coe.

> Where can I go to learn more about the advantages and
> disadvantages of forming an LLC, specifically in regards to taxes
> and personal liability?

Nolo Press (nolo.com) has various books that might deal with this
issue. Your best bet would be to talk to your own tax advisor and
attorney, since everyone's situation is different.

Stu

--
>
>
>
>
>
>
>
>
>
>

rental house sold - form 4797 Using Form 4797 - Part III - lines 19-24. On line 22, any depreciation taken during previous rental period has been put here. Rental owned for two years and sold this year. This is a Section 1250 property - do I have to enter any information on line 26

Depreciation and Amortizaton (form 4562) for rental home I had a home rented out in 2006, do I (or can I file form 4562 for I already filled out Schedule E - Supplemental Income and Loss. In case i can fill out form 4562, how can I file my home (in term of cost, cost of land) if the current valu

w-9 form and a small business My wife did kind of a freelance graphic design job and has to comeplete a w-9 form for tax purposes. She asked me today if she should file under her own name or under her graphic design business name. What should I tell her? <<

Form 8594 Sale of Business We sold a restaurant business here in California and as part of the Sales Agreement the Sale price was allocated as follows - Goodwill Sale Price (SP) is 72,500, Furniture & Fixtures SP is 60,000, Covenant Not to Compete SP is 30,000, Inventory SP is 2,5

Minimum taxes for various form of business entities in NYC Would appreciate if someone would tell me what are the minimum taxes for various forms of [small] business entities in NYC: LLC, C-Corp, S-Corp, Partnerships, etc. I saw memtion of Serial LLC. Does that form apply in NYC? TIA <<