BiggerPockets

Hi, I'm assisting two investors in forming LLCs, from a financial planning and organization standpoint. Where I am it's $50.00 for filing fees and an attorney will probably charge 500 to a grand. One of my "students" told be it was about $2,500 with an attorney. I'd certainly like to meet that one!
What I have done is when I want legal work accomplished is I ask what their hourly rate is. I don't tell them in the interview what I want them to do other than real estate contract review, developing documents and filing issues related to the business. They give me an hourly rate. I might sign as a client at that time if they want. Then I show up with my documents and say here, do this and only this. Granted, if you have no experience, you can get snowed easily. Now, I have had a few say, oh, this is the formation of a trust, this is different and I say, you agreed to work for me at XX per hour. I see their point, but an attorney on a retainer is an attorney I own! I did accuse one of bait and switch and she backed off. We didn't have a very good relationship after that and I dumped her, but had the work done. What alot of people don't understand is that the attorney works for you and is obligated to follow your directions so long as you are acting in good faith and not trying to pull a fast one, doing something illegal and they have an obligation to provide good council, it's up to me to take it or leave it. Many market their services as if they are "in charge" when I see that personality, they are not for me. If they can't follow instructions, they don't get the work. There are many starving out there. I talked to an attorney in Texas the other day and he was telling me something like 3000 went out of business or lost their jobs last year! Don't let these people snow you, forming an LLC will take about an hour if you have your ducks in a row, two hours tops for a boilerplate form plus filing fees. You can also do it yourself. the Secretary of State will probably have the forms. The last one I did was done on line with the secretary of state and cost $50.00! Seems there are shysters in every profession, too bad! Bill

right i heard about the publication requirement. you sure its two newspapers? I would put it in the staten island advance, don't know about the other.

Also, I hear about a lot of people forming LLCs in Nevada or Delaware because of their limited taxation and business friendly laws and courts. Would this work for me and how would I go about forming in another state (even if I decide to do all my business in New York)?

WOW! Talk about special interest groups! You might ask Clinton why Arkansas didn't require that! Bill

I am pretty sure it's two (one weekly newspaper and one daily). The Staten Island Advance might be one but you don't get to chose (the county clerks office will tell you which ones to use.)

I hear the other publication is the New York Law Journal which can cost $800-$1300 for publication! Thats ridiculous! Is there any validity to this?

There arn't any publication requirements for an S Corp, correct? I mean, for real estate investment purposes, what is the most efficient and cost effective? From what I understand an LLC and an S Corp have the same amount of limited liability and same pass-through taxation. Are there any disadvantages to the S Corp? What are the annual fees for both? Is one more expensive than the other?

Thanks

We really can't wait anymore, we're filing the articles of organization tomorrow.

Just updating this thread, I received the below from a NY attorney re setting up an LLC in NY state. You can see the cost is a rather hefty $1100-$1200. Ouch. I might just ensure I have adequate liability cover and run my properties through my personal return.

"I would recommend a Limited Liability Company instead of a Corporation. I believe this would give the most flexibility and be most beneficial for tax purposes.
In regard to establishing the Limited Liability Company we would need to know the following information:

1. The name that you would choose for the Limited Liability Company. Usually we recommend to people that they choose two or three possible names so that we can do a name search to make sure of the availability of the name. In choosing the names put them in the order of priority that you would prefer to have the name.
2. In regard to expenses involved in setting up a Limited Liability Company if it is a New York Limited Liability Company you can anticipate approximately Four Hundred Fifty Dollars ($450.00) in filing fees for the filing service and the New York State Department of State; approximately Two Hundred Fifty Dollars ($250.00) in publication expenses since the Notice of Formation needs to be published in two (2) local newspapers once a week for six (6) consecutive weeks; approximately Two Hundred Dollars ($200.00) for the filing of the Affidavits of Publication with a New York State Department of State providing proof that the publication has been completed; and approximately Three Hundred Dollars ($300.00) to Three Hundred Fifty Dollars ($350.00) for our attorney's fees.

Also, if you are establishing a New York Limited Liability Company we would have to have a New York address for the principal place of business or location in New York State."