Wisconsin LLC for Rental Property

Investor · Wauwatosa, WI · Member since 2018 · 8 posts · 3 votes

Hello All!

I am currently house-hacking a duplex and plan to purchase another in my area within the next 6 months. I would like to understand the steps behind setting up a LLC.

- What is needed to register an LLC in Wisconsin?

- What is the process behind transferring the ownership of a property (owned by me) to the LLC once it is created?

- If I plan to purchase other properties in the future, how should I structure my LLC? Should there be multiple LLCs for each property with one overarching 'Master' LLC?

Any feedback would be appreciated - I am just starting to research this topic.

Thank you!

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Rebecca KnoxBusiness Member

Specialist · Milwaukee, WI · Member since 2014 · 1k+ posts · 1k+ votes

You can set up the LLC yourself on WDFI site and your own EIN. Also, Atty Taylor Rens is local and can assist. I am assuming that you are getting a loan in your personal name and wanting to move in to an LLC. Many investors quit claim it to their LLC even though the note could get called in if the bank finds out but most mortgage officers will say they have never seen this happen if payments are being made on time. The argument about creating an LLC for each property vs multiple is subjective. This topic has been brought up in our investment club as well with great arguments on all fronts. Another thing to be mindful of is your accounting bill as many accountants charge per LLC.

Captain Save-A-Home LLC

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Daniel HymanBusiness Member
CPA · Milwaukee, WI · Member since 2016 · 2k+ posts · 1k+ votes
6y
@Mitch Jorgensen
A WI LLC can be registered online for $125, but our firm always recommends consulting with a legal professional to make sure that it will be set up and used in a way that will give you the asset protection that you seek.
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Chris Gantz
Property Manager · Madison, WI · Member since 2019 · 30 posts · 38 votes
6y
@Mitch Jorgensen
If you're registering an LLC it depends if you're a sole member or setting it up to have multiple members.
If sole member it’s much easier and can be done online, I’ve personally used Legal Zoom. They’ll get everything you need such as Articles of organization, operating agreement, Tax ID/EIN.
As far as transferring property into the name of the LLC you may want to consult an attorney as I'm not sure how this process works.
If you're purchasing in the future as a sole investor it's much easier to just have one LLC with one tax ID number for all your properties, your CPA will thank you.
If you get into partnerships, syndications, or funds you’ll have to have an Llc for each property that has a variation in ownership shares.

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Casandra M.
Rental Property Investor · Janesville, WI · Member since 2016 · 87 posts · 42 votes
6y
For your last question, you are referring to what's called a "Series LLC", which Wisconsin law does not have. Technically, you can set up series LLCs in Wisconsin, but because of the vague legal wording, each LLC does not have it's own "shield" of protection. This essentially means that anything under the parent LLC is not independently protected from the other LLCs, rendering the concept of series LLCs moot in Wisconsin.
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Willie Page
Rental Property Investor · Racine, WI · Member since 2019 · 18 posts · 20 votes
6y
@Mitch Jorgensen how much did legal zoom charge you to do that
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Chris Gantz
Property Manager · Madison, WI · Member since 2019 · 30 posts · 38 votes
6y
@Willie Page
It's around $500 for legal zoom to set up the Llc. I added a registered DBA "Doing Business As," trade name and Tax ID registration too, so it ended up being a little more.
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Nick Gann
Real Estate Agent · Murfreesboro, TN · Member since 2019 · 194 posts · 181 votes
6y
@Mitch Jorgensen
While I like the idea of companies such as legal zoom, your phrasing of questions makes me think there is probably a lot you don't know. Not to be rude.
What you don't know, is what will be your problem with setting up the LLC correctly. The creation of the LLC is easy, but the proper creation to protect your hardearned assets is a different matter.
It's worth hiring a lawyer to see to it that all this is done adequately. After all you are not protecting a pair of shoes or a pack of gum. It's potentially several hundred thousand dollars (or more) of assets. What's $1k for proper assurance?
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Rebecca KnoxBusiness Member
Specialist · Milwaukee, WI · Member since 2014 · 1k+ posts · 1k+ votes
6y
You can set up the LLC yourself on WDFI site and your own EIN. Also, Atty Taylor Rens is local and can assist. I am assuming that you are getting a loan in your personal name and wanting to move in to an LLC. Many investors quit claim it to their LLC even though the note could get called in if the bank finds out but most mortgage officers will say they have never seen this happen if payments are being made on time. The argument about creating an LLC for each property vs multiple is subjective. This topic has been brought up in our investment club as well with great arguments on all fronts. Another thing to be mindful of is your accounting bill as many accountants charge per LLC.
Captain Save-A-Home LLC
Website View Page
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Marcus Auerbach
Investor · Milwaukee - Mequon, WI · Member since 2010 · 5k+ posts · 7k+ votes
6y
@Mitch Jorgensen - before you decide you need an LLC, watch the YouTube video from Brandon Turner about LLC or not!
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