To LLC or not to LLC
In the process of talking to a lawyer in setting up LLC. I only have two rentals at the moment but plan on owning commercial real estate in the near future. A potential lender from a local bank suggested that I set up an LLC. For tax purposes it would be the same, in my understanding since I would be the only member in the LLC and it would be considered a disregarded entity. What would be the benefit of spending the money on the LLC, when I would have the property insured regardless. Thoughts????
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I didn't have an LLC until my 7th unit. The more important question is do you have personal assets outside of your home and qualified retirement accounts? If you don't then the LLC becomes less important because there are no assets to protect. Generally, your home and qualified retirement accounts are protected from creditors, bankruptcy, and civil lawsuits.