Where to form an LLC?

Question

Going to be creating an LLC, I have heard the Nevada has the best tax benefits when you register for an LLC in their state?

Would like to hear what others have done.

I live in California

Thanks in advance

Anthony

Account Closed · Answer

First you should figure out if you even need an LLC. That assumes you have properties that you've bought. If you don't have properties, no point in forming an LLC until you buy a property.

An LLC protects you "some" if you have large amounts of equity in properties, for instance. Sometimes you are better off just getting Umbrella Insurance. How many properties in your portfolio? If the number is less than one, forget about setting up an LLC until you have a one. Use the money, time and energy toward buying a house so you have something to protect.

If you have a property or two, Nevada and Arizona both have good protections for LLCs **when done properly**. According to my LLC attorney, most people don't manage their LLC like they should and therefore the LLC does them little good. To be an LLC, it has to follow best practices and be treated like an LLC. Even bug repellent won't do you any good if you point it the wrong direction. Do things the right way for the right reason. Buy a house first.

Anthony Campos · Answer

Hey Mike,

Thanks for taking the time to respond to my thread.

The LLC I plan to form isn't going to be for properties but a separate business not related to properties. That's why I started the discussion in 'Goals, Business Plans & Entities' thinking it would just be a general area for entity questions.

I am fairly new on BiggerPockets, but I can see why you assumed that when this website is basically just for anything real estate related.

Nonetheless, really useful information

Thanks,

Anthony