Which state to create LLC - RI or MA?
I live in MA and just purchased a multfamily in RI
Which state to create LLC - RI or MA? MA LLC annual fees are really high and I want to do RI if possible
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Curious to know the same!
Curious to know the same!
Me too. I bet someone in the local real estate investor group network would know. Check out RIREIG. I'm a new member, but someone there would know. We have some MA members too. I'm in Providence, RI.
Wyoming and Delaware are two of the most popular states to form LLC's. Wyoming is where it all began in the early 1980's
@Khaled Eissa the usual advice is to form the LLC in the state where you own the property(ies). In this case, if the property is in RI that's where I would form the LLC.
If you were to form the LLC in Mass then you'd need to pay two states annually, Mass (state of formation) and RI (as a foreign entity), which would be double the cost.
The only minor thing is that as an out of state owner you'll need 1) a registered agent in RI to be on file with the RI Secretary of State for any communications like annual report reminders, to receive service of process if you were to be sued, etc.; and 2) to register with the RI Secretary of State as an out of state landlord.
If you used a RI attorney when you bought the property in RI, I'd inquire if they're willing to be the registered agent for the LLC, and in fact you might even want to use them to form the RI LLC too.
If you don't already have a relationship with an RI attorney I can recommend a few, but if you don't have anyone trustworthy in RI who can act as registered agent then you might want to ask the prospective RI attorney if they're willing to be the resident agent before you pay them to form the LLC for you (some attorneys don't want to be bothered as you can get a lot of junk mail).
All of the above is just my personal opinion and experience and what I'd do in your position as I understand it. You're asking a legal question and should get legal advice from someone licensed to give you that (i.e., an attorney). But I hope that helps anyway.
If RI is close enough for you to make the drive, I second @Kristofer Kretsch in recommending RIREIG. I've been a member since 2003 and have found it very rewarding.
I'm curious to know why you want an LLC?
Here's a post I did on LLCs that may help
DO You Need An LLC - It Gives Me Protection, Right? My Attorney / CPA Says That. . .
All my REIs are in an LLC! Why am I being personally sued?
I suggest one LLC to be used to open a bank account and run all related income & expenses through it to avoid the accusation of commingling funds, to be able to write checks and to send and receive wire transfers. The IRS will appreciate it when they audit you.