Developer · Atlanta, GA · Member since 2013 · 27 posts · 6 votes
Hello All,
I currently live Georgia, but I invest in Ohio as well as Georgia and I would like to set up an LLC for my future investments. My question is since I live in Georgia should I set up my LLC to purchase a property in Ohio in Georgia? Or should I set up an Ohio LLC for my future Ohio purchases? Which is better and why?
Also, I have a business partner in Ohio, so he would act as the registered agent in Ohio.
If you invest in both states, but only have a partner in Ohio, you may need TWO LLCs to keep it clean. As @Bob Okenwa said, a Georgia LLC can register in Ohio as a foreign LLC (the cost is the same)
Some things to consider:
Does Georgia have a minimum tax that applies to LLCs
How do you structure deals with your Ohio partner?
What type of deals are you doing in each location?
Is there going to be S corp taxation involved?
Those questions and more will influence how you set up your entity(ies). A CPA can help with the various tax implications, and business attorney can help with the asset protection, business setup side.
You may need two different attorneys, as finding one licensed in both states could be a challenge. And avoid companies like Legal Zoom for this. You really need an attorney you can have a serious discussion with, not just give you the standard product.
Why not set up an LLC in Georgia and then set it up as a foreign LLC in Ohio? I'm no CPA so you'd have a better idea of the ramifications of doing so, but this may be a solution as well.
If you invest in both states, but only have a partner in Ohio, you may need TWO LLCs to keep it clean. As @Bob Okenwa said, a Georgia LLC can register in Ohio as a foreign LLC (the cost is the same)
Some things to consider:
Does Georgia have a minimum tax that applies to LLCs
How do you structure deals with your Ohio partner?
What type of deals are you doing in each location?
Is there going to be S corp taxation involved?
Those questions and more will influence how you set up your entity(ies). A CPA can help with the various tax implications, and business attorney can help with the asset protection, business setup side.
You may need two different attorneys, as finding one licensed in both states could be a challenge. And avoid companies like Legal Zoom for this. You really need an attorney you can have a serious discussion with, not just give you the standard product.
I'd echo the advice to keep separate partnership groups segregated into separate LLCs. If your have a GA partner has nothing to do with the OH properties, then you don't want OH properties in the LLC that you own jointly with said GA partner.
I've seen out of state investors use out of state LLCs for Ohio properties or use Ohio LLCs for Ohio properties. Usually there's not too much of a difference in practice. It will depend on if your home state has more or less favorable incorporation laws than Ohio, and if your home state assesses annual taxes (if any) differently between in state and out of state LLCs. I usually just recommend using the Ohio LLC because Ohio treats corporate entities very favorably and I'm very familiar with the process and controlling law.
Either way, you'll need a statutory agent within Ohio. Either to register your Ohio LLC, or to register your Georgia LLC with the state of Ohio as a foreign entity doing business within Ohio.