LLC to manage rental properties

[Mano G.]

We recently took over managing our properties on our own. My husband and I created an LLC to manage the units. The purpose of the LLC is to separate the income and expenses from the rentals from our personal expenses. We cannot put the properties in the LLC because we still have mortgage on these properties. Is this a bad idea since we cannot put the rentals on the LLC? We are new to this and are now unsure if we made the right move. Any suggestions on this are greatly appreciated. Thanks!

[Simon W.]

@Mano G. - so the properties and mortgages are under you and your husband's name. LLC is created strictly for managing.

As the Managing LLC - take 25% of the management fee as your income, have all the expenses in the LLC. Do not pay yourself as an employee. Income will be left as retained earnings for the LLC.

You and your husband when filing the tax return will have a 25% decrease in income due to the management fees and any expenses related as Landlord.

But as always, speak to your CPA. I am an accountant who straightens the books for real estate management firms lol