I'm a new member from Missouri! I've been listening to the podcast and have learned quite a bit from it already! I've done most of the repairs on a house that I care to do (basically anything that doesn't involve heights and/or structural issues).
My initial question...
My stepbrother and I are getting ready to purchase our first house as a flip. We both individually have an LLC for separate business reasons. I do software development and he has a single rental.
Does anyone have any guidance on the best type of business entity to setup with what we already have in place? Should we set up a partnership between the two LLC's (is that an option)? Should we setup a new LLC with both of us as owners? While I'm guessing (from a quick search) that there are similar questions on BP, but I didn't see anything specific to Missouri and didn't know if that would have any gotcha's that I should be aware of?
Hey Jared, I'm not a attorney or cpa and don't offer this as a legal or financial professional. (One should always be consulted before entering into any venture or Corp). For me its always worked best to perform flips in a SCORP, just for the tax benefits a good CPA can provide you with.
I've also, know some to setup an LLC then form, under that LLC a separate SCORP. They can then layout the partnership/officer share in the LLC.
LLC are typically best for long term investments like rentals. Some states, i think its up to 12 or 13, allow for series LLC which are HUGE when it comes to building rental portfolio's
When setting these things up I've found its always best to find a local legal rep to make sure everything is done by the books, minutes etc.. There are a lot of myths out there about ways to get around not setting up a LLC correctly for cheap, however, if hit with a major lawsuit a good lawyer may cut straight through to you if not done correctly. Typically run 1,500 for a solid attorney to set you up. (plus filing fee's $50 in MO).
Hope that helps getting you thinking about the subject!
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