Partnership structure question
Hey all
Here's my and my brother's problem. We "share" 11 rentals. 5 in my name and 6 in his. We know it's 50-50, but the IRS doesn't agree. We have been looking at strategies to get this taken care of without taking a big tax hit. We have a great strategy that would entail making 2 separate LLC and paying 10k, but aren't sure it's worth it and may just "equalize" on the side. The values are close enough that even if we decided to "screw" each other it might be cheaper than funding 2 LLCs yearly, paying to set them up, etc. anyway, so neither of us is very worried about that.
Anyway, my question is for property #12 and so on into perpetuity. How should we do this? Should we set up an LLC? I'm wanting to make some offers on some properties and they're wanting to know how it should be held... and we just don't know. It's bad enough that we've gotten this far with the 11 properties being so reckless that it seems like we need to get this straightened up.
Thank you in advance for your thoughts and consideration on this!