Hi, everybody! I'm going to be starting an LLC, and am still doing my research. One book I read in particular, "LLCs For Dummies", had a lot of good info and tips in there. It stated that it is a good idea to hire an attorney to help form the LLC, and looking at how much flexibility you have with LLCs, I decided that is a good idea. I started searching for some, and found some prospective ones in my area. I know I do not want someone who is too widespread as far as practice area goes, but I'm kind of at a loss to what I should be asking the attorney in the initial consultation. I rehab and flip and am planning on doing some rentals as well in the near future. Can anyone recommend any good questions to ask so I can determine which one is the best for me? Does anyone have any experience with any business attorneys in southern CA? Particularly in Orance County? Any advise would be greatly appreciated.
I have formed several LLC's for non-real estate ventures over the last few years myself. Recently I went to a couple of attorney's for advice on a new venture and was sorely disappointed. They charge anywhere from 1,500 - 3,000 to form an entity, and more than likely they will not suggest anything that you have not come across in your research. One of the attorneys even gave me flat out wrong information (and this was supposed to be his specialty).
I am back to doing it myself. You can also use an online company to file the paperwork for you. Most of those companies charge several hundred dollars, plus the state filing fees.
I am in the process of forming an LLC myself through legalzoom.com. Much cheaper than several of the attorneys I talked to. The three packages range from $150 to $250 to $350 based on what you want.
In California, as with most states, setting up your LLC is a pretty easy job. Most CPA'a will do a decent job and will charge much less than an attorney. The LegalZoom online source does a good job as well.
You may also go online to the Secrety of State's website and download the Articles of Organization form and a submission form. As you will find, this is a very simple forms and the only big decision is if you want the LLC to be managed by the Members or the Manager(s). I think the fee in Cal. is $70.
If you are going to be holding investment/rental property, we recommend opening a Management LLC (holding co) and opening up a new LLC for each porperty held. The LLCs for your properties should be Managed and owned by the Management LLC. If you have your personal business and several properties in one LLC, if something goes bad (a lawsuit) all of your properties could be in jepordy. Thus the reason to put each property in its own LLC.
If you go this route, (highly recommended) you will need a simple management agreement between the Management LLC and each of the Property LLCs. Feel free to contact me if you need any help.
Good luck in your new business venture.
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