House Hacking with Airbnb should I make it a LLC

[Eric Teran]

I am renting the basement of our house as a two bedroom apartment on Airbnb. Should we have this set up as a LLC? Right now we just have the rental income going into our personal bank account and a lot of the things we bought/did to the basement is mixed within our personal receipts. Hopefully in the future we have more rental properties that are not house hacking but that is a year or two away. Any thoughts?

[Julie McCoy]

Not a CPA or attorney, but can't imagine an LLC being necessary at this point. As others have said, take out a minimum $1M insurance policy that covers your liability (make sure it covers short-term rental activity) and you should be fine.

DO keep your receipts/expenses separate - like @Jon Crosby said, open a dedicated checking account (you should be able to get a free one) and use it for your AirBNB income/expenses.  If nothing else it'll make for a much easier tax time and make sure you can take full advantage of your write-offs.