LLC vs. C corperation. Which is better?

Question

Hi!

I have a question about llc's and C corps. Which is better? Is there any difference in terms of  tax advantages? It would be great to know what other people have structured their real estate as. I've read a lot about this, and people generally say LLC, but I still want to get the opinions of my fellow investors.

The reason I ask this is because I'm planning to start an investment firm of sorts. My personal real estate would be in my name. So I'm asking this question in regard to my future investment firm.

Thanks y'all!

P.S Corporation*

Caleb L. · Answer

Thanks y'all! I'll talk to my local CPA to be sure. If I go public in the future, than I will have to switch to a C corporation, but that's a long ways away, if I do it at all.

Thanks for all your help guys!

Grant Rothenburger · Answer

@Caleb L. I'm not a tax professional or attorney, but I think in most cases an LLC does what is needed, is easier to set up, taxes are nicer, and it can be converted to a corporation later if need be (I think). I'd speak with a CPA or business attorney, or both before setting something up.

Basit Siddiqi · Answer

@Caleb L.It is normally not advised to hold appreciating capital assets in a Corporation.

Bill Hampton · Answer

@Caleb L., you should never put a property in a C corporation, that causes double taxation on the property.

If you are going to do buy and hold investing or AirBnB use an LLC.

If you are going to do wholesaling or flips, start out with an LLC and convert it to an S Corp once you make enough to pay yourself a salary.

Good luck and let me know if I can be of assistance.

Jeff Copeland · Answer

The answer will be very specific to your situation. Pay a CPA (such as @Taylor Brugna) for a couple of hours of their time to figure it out and get it right up front. It will be worth every penny.