Need some LLC and general advice Please
Here's the deal, I'm a Owner Operator Truck Driver. I am really big on paying for everything with cash, staying out of debt, Dave Ramsey sort of mindset.
Now about two years ago i made an LLC for investing, baught a house, rented it, and sort of forgot all about it. :roll: Things got busy.
Now that things are slowing down a bit for me i've had time to think about what i would like to build. I love investing! Not just in real estate, but well in everything. I want to build something where i can include other people. I want to be able to help people get out of debt, get good returns on their investments, I want to go to schools and teach 15 year olds things they should have already been taught before they start working, etc. The idea is sort of like a club where people can come and invest with me... I want to be able to show people in this club, this is what i'm working on, could be buying another truck, house, etc. If they want in, well you get the picture. Like I said, Dave Ramsey sort of mindset.
Now here's the question>>> How do I get started. I was wandering if I could use the LLC I started for investing? I’m not messing with my trucking company, obviously, but I also want to be able to use that company as an investment choice in the future because it brings in by far the most money. Though, the idea is to keep most of the money invested in real estate. Mind you if I can’t do it with cash then it won’t be done.
If you think I should just use the LLC I have now, this is my other question. I really didn’t keep up with all the things I needed to do with it. Didn’t keep good books, so how do I fix that so things are rock solid, and if I do use it I want to change it’s name. Understand, bringing people into this is something I want to do eventually. I want to have a good track record of houses I own in the company’s name and other things. I plan on going back to school while I build this track record too, so there’s my little dream. Please be gentle if I’m out of my mind.
Thanks!
Go to Forums >> Investor Marketing >> and open up the topic called P.O. Box. Josh linked a couple of great articles on LLCs. You can also cut and paste this link that should get you to one article:
http://www.biggerpockets.com/renewsblog/2009/04/08/business-structure-real-estate-investors/
The end result will probably be that you want to consult a knowledgable attorney who specializes in this stuff.
Good luck.
It depends on how well you've maintained it the last few years. Have you been filing tax returns under the LLC? If you haven't, odds are it may have already been seized by the IRS or suspended by the State you registered it in. If that isn't the case, there are companies out there that maintain corporate compliance for businesses for a fee. They can go back several years and get you caught up with the required documentation you would need. Depending on how bad things are, this could run you up to a few grand though. If that is the case, it might just make more sense to set up a new LLC, especially if you are going to be paying cash for your investments. You can still have a corp compliance service maintain your paperwork for the first year for a fee. I did that and learned what needed to be done, which saved me the money of doing it the following year. And as mentioned, it is always wise to talk to an attorney before doing anything.
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Contractor
- First Property Management
Wait a second. Why would you file tax returns "under the LLC"? An LLC is a pass through entity for taxes, unless you've elected some other status. A single member LLC will just appear on the member's taxes. A multi-member LLC would file a partnership return, but that doesn't sound like the case here.
An LLC does have to maintain its standing with the state. What that means varies from state to state. Here in CO, its just an online annual report and some small fee. $25, IIRC. For CA, I understand that entails paying the $800 annual franchise fee.
I would argue paying an attorney to do the filings for an LLC is a waste of money. Paying an attorney to draft an operating agreement that says what you want may be worthwhile. If you have partners, its essential. If you going to offer ownership in the LLC to others (a private placement), its absolutely mandatory. Figure on at least $20K in attorney fees and filings for something like that. You would almost certainly want to start from scratch with something like that.
Routine maintance of the LLC is important. It should have a separate bank account, and should have annual meeting minutes, announcements, waivers of notice, and resolutions for any major events.
Getting bank funding for an LLC is difficult these days.