Individual LLCs and/or Holding Company?

5 Replies

If you have one property, you put it into an LLC, get an EIN and a business checking account for it and run you income and expenses through it. No problem.

Now say you have 35 properties and each are held in individual LLC's for tax/liability purposes (Please don't debate the individual LLC point). If each LLC would need it's own EIN and business bank account, management of these entities and accounts would become an administrative nightmare rather quickly. There has to be a better way! But what is it?

Addam Driver had a blog post on this recently that seems like the answer but would like others to chime in and give their thoughts. James Hamling also had an interesting post on this which seems to imply double taxation using an S or C Corp but is a different strategy than Addam's.

Can anyone provide some clarity on how best to structure for asset protection, taxes and administrative burden?

So @Scott Smith , in order to use a Series LLC, I would need to create an anonymous trust, correct? Then I would put each LLC under the Series LLC. The Series LLC then collects rents, makes payments to vendors, etc.?

Would I be able to do the same thing with an LLC? Holding LLC collects rents, payments to vendors, etc. Would I have to have any money flow back to the property shell LLC or can I have all finances run out of the Holding LLC?

@Greg W. Great questions.  The LLCs would transfer the properties to the individual series (child series) of a Series LLC (parent).  Each individual series is treated as a separate entity and therefore, one property will not be attached to another.  This offers compartmentalization and a stream lined approach.  In addition, it saves on yearly maintenance costs.  Anonymity can be created through a series of trusts.

Message me if you are interested in discussing this further.

Thanks for the response!

@Scott Smith I messaged you. I would be very interested in talking with you about my particular situation and seeing what you think.