Need advice on proper way to disburse from LLC
I am new to this forum and wanted some advice on my situation. I currently own 3 rental properties with two partners. Two properties are in their own LLCs and the 3rd property is an S-corporation. My current accountant had us set up another S-corporation which will be the managing company. Now my accountant is telling me to take 50% of the rental income from the properties and write a check to the managing company. The other 50% of the rental income take as a distribution from LLCs. This whole method sounds complex and I just need to pay my personal bills since I am not currently employed. Is there any advantage to doing this? Would it be wrong to just take all the rental income from the properties and just write each partner a personal check?
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John Ferrara, sounds like you have a tax guy who is doing some very strategic planning for you. Just goes to show that you need to be working with someone who knows the ins and outs of YOUR particular tax situation. One strategy does NOT fit all :)