New Investor Needing Guidance

[Kim Chhay]

Hello Everyone,

I am from California, and I plan on buying Single-Family Homes in Texas this year. I already formed a Texas LLC, EIN, Registered Agent, opened a business account, the whole 9 yards. I recently learned that I need to form an LLC in CA to do business in Texas. The LLC fee from CA is about $800, and the LLC in Texas is about $300. That's at least $1100 each year! After reading through these forums and videos, I see that some people do not need an LLC to purchase rental properties. My thought of having the LLC is for liability protection. My short-term goal is to buy 1-2 Single Family Homes within this year and next year. My long-term goal is to buy at least 10-15 properties or more so I can retire in 10 years. Is it worth keeping the LLCs and pay the yearly fees for both states or should I give up on the LLCs and purchase under my own name? If I go that route, I guess I could purchase Umbrella Insurance for all my properties. However, I do want to take advantage of the tax write-off for the business. What is the safest and fastest way for me to reach my goal?

I hope this all makes sense. Thanks in advance for any guidance.

Kim

[Kyle Mccaw]

@Kim Chhay. We have many clients from California. Most of them hold the properties in their name. After they get several properties they move them to an LLC. Always have insurance. Both property and umbrella.