Washington, DC · Member since 2015 · 49 posts · 4 votes
I’m focusing on flipping houses and other investment properties just want too know what is the best way too set up my llc should I do it professionally or my self? What are some of the best websites to use? And if u have any other tips or further information I will definitely appreciate it thanks in advance!
Developer · Santa Clarita, CA · Member since 2008 · 15k+ posts · 10k+ votes
6y
Before you do that, you should speak with your CPA to see which entity is best for YOU when you flip properties. LLC's, generally speaking, are best for buy and hold, not flipping.
As to setting them up, if you are a single member LLC or sole owner of a Corp, you do not need anything extravagant regarding operating agreements, etc so you can certainly save some money setting up the entity yourself or you can hire a firm that specializes in setting them up. Nationwide incorporators is a good example of one I have used many times.
I’m focusing on flipping houses and other investment properties just want too know what is the best way too set up my llc should I do it professionally or my self? What are some of the best websites to use? And if u have any other tips or further information I will definitely appreciate it thanks in advance!
You can file the LLC online with the state corporation commission. If your in DC you can do it here https://corponline.dcra.dc.gov...
Developer · Santa Clarita, CA · Member since 2008 · 15k+ posts · 10k+ votes
6y
Before you do that, you should speak with your CPA to see which entity is best for YOU when you flip properties. LLC's, generally speaking, are best for buy and hold, not flipping.
As to setting them up, if you are a single member LLC or sole owner of a Corp, you do not need anything extravagant regarding operating agreements, etc so you can certainly save some money setting up the entity yourself or you can hire a firm that specializes in setting them up. Nationwide incorporators is a good example of one I have used many times.
@Will Barnard would you mind elaborating on why LLC's are not the best option for flipping?
Thanks
Please keep in mind I am not a CPA and this is not to be considered tax advise. Here in CA (not sure about other states), an LLC has what is called gross receipts tax and your LLC is taxed on the "gross receipts". So if you flip a $1M sale, you would have an added $6k in gross receipts tax on top of everything else. With an S Corp, and you should consult with your CPA on this, you may be able to save some money on self employment taxes by having some of your income as dividends which is not subject to self employment taxes. You may certainly form an LLC and elect S Corp for your tax election thereby accomplishing the same thing too.
Again, talk with your CPA on this. What is good for one may not be for another as every situation and tax status is different.