Business Structure for holding/managing properties
In the past I've held properties in my name and received rents in my name at a generic mailbox and never had a problem. Also, I have umbrella policy that covers additional liability exposure for my properties. Now I would like to add a level of privacy and would like to know how other landlords have set this up and if I am missing anything in my plan below. This is only for a few rental properties and is in the state of Georgia. My over-riding goals are to keep this simple (no complex entity structuring, tax strategies, or additional tax returns for now). I want to remain being taxed personally for now.
1. Continue to hold title personally (until later when I have a larger portfolio).
2. Create a new LLC that would essentially act as my "real estate business" company for all of my rental properties, meaning I would collect rents in this company name and write checks for repairs AND capital improvements for these properties. It would be formed as a single member LLC (pass-through entity). Not sure if I should elect to be member-managed or manager-managed or if that makes any difference since I am only member.
3. File for EIN fo the LLC from IRS and use that to setup 2 separate bank accounts. One to deposit the rent checks and to write checks from for expenses (repairs, capital expenditures, utilities). The other account would be just for holding all of the security deposits from the rentals (like an escrow account). I would make loans from my personal account to this new business account to fund it as needed (not sure how formal that needs to be though). And occasionally I will pay myself personally from that account some amount (not sure how much or how often).
When filing for the LLC I would use my 'generic mailbox' as the LLC address and will find an attorney to be my Registered Agent. I was thinking of filing the articles of organization myself, as well as the operating agreement, though I could ask the attorney what he charges to do that. I want to set this up in time for my next rental coming on the market (ready in a few days), so would like to do this all asap. This company would be the "face" of my business to my tenants.
Does anyone see holes in this plan (other than the obvious not holding title in LLC's, but I can deal with that later when I get more properties). Note I would not use this new company for flip properties. I would setup a separate LLC for that.
Thanks in advance for any opinions or suggestions.
Ryan