Tax/business structure advice for STRs in Sevierville, TN

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Tax/business structure advice for STRs in Sevierville, TN

Richie Frost
Member since 2021 · 7 posts · 3 votes

Hi everyone! We just closed on a cabin in Sevierville, TN and need some help getting the business license and tax situation figured out. This is our first STR, and we live out of state in Seattle.

Since we went with a conventional second-home mortgage, we aren't allowed to put the property in an LLC. My wife and I are running the show - is it best to go with a partnership for the business license? Or sole proprietorship? Or best to talk to a lawyer about it?

Also, for the business address, I'm assuming we just put the address of the cabin itself, and not our Seattle address?

We're hoping to do a couple more of these, not necessarily in the Smokies though. 

Thanks in advance! This community is great!

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Luke CarlPro Member
Rental Property Investor · Tennessee Florida · Member since 2016 · 4k+ posts · 5k+ votes
5y

Whatever or whoever name(s) are on the title are the same names on the business license. Also, You are a sole prop not a partnership. 


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  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    5y

    Hey @Richie Frost! So we have a lake house on Lake Coeur d'Alene and we don't have it in anything. We just run it as is and let our CPA do the taxes.

    I don't think for a single home you need to do anything special. Once you start adding more properties, I would consider setting up a series LLC with each house in it's own child LLC to protect the whole. There is a lot of info about it here on the forum.

    I have all of our correspondence sent to our home in Olympia. All the bills, taxes etc. 

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  • Luke CarlPro Member
    Rental Property Investor · Tennessee Florida · Member since 2016 · 4k+ posts · 5k+ votes
    5y

    Whatever or whoever name(s) are on the title are the same names on the business license. Also, You are a sole prop not a partnership. 


    Podcast Guest on Show From Surviving on $30/Day to 30+ Properties Thanks to Blue-Collar Skills
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  • Jonathan PavkovBusiness Member
    Columbus, OH · Member since 2021 · 201 posts · 166 votes
    5y
    Originally posted by @Richie Frost:

    Hi everyone! We just closed on a cabin in Sevierville, TN and need some help getting the business license and tax situation figured out. This is our first STR, and we live out of state in Seattle.

    Since we went with a conventional second-home mortgage, we aren't allowed to put the property in an LLC. My wife and I are running the show - is it best to go with a partnership for the business license? Or sole proprietorship? Or best to talk to a lawyer about it?

    Also, for the business address, I'm assuming we just put the address of the cabin itself, and not our Seattle address?

    We're hoping to do a couple more of these, not necessarily in the Smokies though. 

    Thanks in advance! This community is great!

    Why would you put the property in an LLC? For liability purposes only? Also talk with your lender. Sometimes there's a seasoning period where you could put into an LLC. Best of luck!

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  • Richie Frost
    OP
    Member since 2021 · 7 posts · 3 votes
    5y

    @Jonathan Pavkov yeah, mostly for liability purposes. 

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  • Daniel HymanBusiness Member
    CPA · Milwaukee, WI · Member since 2016 · 2k+ posts · 1k+ votes
    5y

    @Richie Frost

    I'm not sure what an LLC would do for you given that the loan is in your personal name, unless you were to refinance.

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