Funding your own LLC

[Ketan Pattani]

Hi BP,

I have only recently started learning about RE and was not planning on making any investment anytime soon. However, an opportunity has come up that I don't think I should pass off. My wife currently leases a space for her business. I am looking to purchase an office(cash) and lease it to her business. I have started applying for a LLC to purchase the property. I have whole bunch of questions.

How do I fund the LLC in a tax beneficial way?

Should I keep the LLC as sole proprietorship or S corp? I have read that C corp would be bad.

Will a promisory note from me to the LLC be sufficient? Is 0% interest ok? Any other records I need to keep/make?

Should the LLC pay me back on a installment basis?

Eventually when the LLC sells the property is there a lower basis of capital gains after x number of years?

Anything else?

I greatly appreciate y'all s input.

Thanks,

Ketan

[Josh C.]

LLC are pass through. So no tax benefit. You don't need a bunch of fancy stuff to fund. The owner is allowed to fund his own business. Long term rentals are typically best (for tax reasons) not held in s or c corps. Although every situation is different and you should spend a couple hundred bucks and get a CPA.

Good luck!