Leasing My Property to My Business

[Kwanza P.]

I'm closing on an STR in Texas (I live in California). I purchased with conventional and the lender doesn't allow me to transfer to my LLC.

Is there a way for me to lease the property to my business ? Do I need to?

Kwanza 

[Michael Plaks]

Quote from @Kwanza P.:

I'm closing on an STR in Texas (I live in California). I purchased with conventional and the lender doesn't allow me to transfer to my LLC.

Is there a way for me to lease the property to my business ? Do I need to?

It is unclear what you are trying to accomplish and what you are concerned about. Since I'm an accountant and not a lawyer, I can only address the tax side of your question.

For tax purposes, you can treat your STR as owned by your LLC, without jumping through these lease-to-yourself hoops. I assume this was your goal.

If your LLC is a single-member LLC, i.e. owned just by yourself or by you and your spouse, your business is most likely reported straight on your personal tax return. It's just a few separate pages of your personal tax return. 

In fact, your LLC is not even mentioned on your STR-related pages. Your tax return looks exactly the same with or without your LLC. Zero worries about the title or the loan's borrower, tax-wise.

If your LLC files its own separate tax return (which would be unusual for your situation and requires another conversation) - your LLC can still treat this STR as LLC-owned, but you would need to create some documents to make things compliant.

Now, to potential complications. The first is your California LLC tax return. It will need to include the STR, and it should not change your $800 annual extortion fee, unless your LLC is doing other business besides this STR.

The second potential complication is legal issues. I will leave it for attorneys to comment, as I'm not one of them.

Your third potential complication is insurance. This is for your insurance agent to deal with.