Selling a SFR that's held within an LLC. Should I put it in my name before I sell?

Question

My CPA said I should transfer it to my name before I sell. And I want to dissolve the LLC anyway.

I'm a CA resident, so CA charges me $800/yr for doing nothing.

Thanks.

Basit Siddiqi · Answer

Potentially, you may not save any taxes by moving the property into an LLC. However, you will be subject to paying a title company or an attorney for transferring the property.

Marcos De la Cruz · Answer

Hey Bill,

Thanks so much.

Bill Exeter · Answer

You can do it at any time (or not) as long as the LLC is a disregarded entity. A disregarded entity means that the entity does not file a Federal tax return. California requires a tax return to be filed. It does not have to be the same entity of LLC, but it does have to be the same "taxpayer." The single member LLC AND DISREGARDED entity will be treated as if the underlying member is the actual taxpayer.

Bradley Buxton · Answer

@Marcos De la Cruz

Check with a 1031 Qualified Intermediary. IF you sell and 1031, you have to buy in the same entity or LLC.

Marcos De la Cruz · Answer

Ok, thanks.

Marcos De la Cruz · Answer

Hey Matt,

Yes, I'll be doing a 1031 and I'm the only member of the LLC., however, my CPA does a separate return for my LLCs.

Thanks!

Matt Devincenzo · Answer

Is the intent to 1031? And is the taxpayer the same in the sale and possible 1031 buy? By that I mean is this a single member LLC, and all the info flows to your personal return?

Once you answer those questions one of the experienced acct/1031 types can weigh in. But from what I recall dissolving in advance vs. selling as LLC and buying in your personal name won't be an issue if the tax payer is the same. It sounds like that is what your CPA was attempting to avoid by dissolving it early.

Selling a SFR that's held within an LLC. Should I put it in my name before I sell?

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