Do I need to start an LLC or do it under myself?
Hello,
I'm considering getting the PRO account, but this brings up the question, how do I manage my finances related to Real Estate?
I will need to keep track of all my expenses, profits etc. But is it easier come tax time if I have a separate LLC or to do it all under myself?
Most Popular Reply
Everything under one LLC is fair game for creditors of that LLC. If you put all assets under a single LLC, then a creditor against one is a creditor against them all. If you put them under separate LLCs, then all a creditor can do is collect from the LLC against which he has a claim. This assumes that you have not commingled assets between LLCs and that you respected the corporate form. If you keep separate books and you run things properly, this is easy.
Think of it this way: an LLC is like a basket of eggs. A creditor can only take what's in the basket. If you put 12 eggs in the basket, a creditor can take any of the eggs or potentially all of the eggs. If you put only one egg in the basket, a creditor can take only that egg. You're limiting your potential liability to whatever you put into the basket. If you want to put everything you own into the basket, then don't have any LLCs. If you want to put all your properties into the basket, put them all under the same LLC. If you want to protect your assets, you put each property into a separate LLC.