Forming LLC w/o a Brokers license?
3 Replies
Andrew Moore
Real Estate Agent from Grand Rapids, MI
posted over 2 years ago
I am a Real Estate Agent here in Grand Rapids, Michigan, and I am looking to run my real estate business through an LLC to take advantage of some tax savings. The people who I am talking to are saying I need to wait to obtain a brokers license before I can hold my license in the name of an LLC. Is there anyone that could give me some insight as to how I might be able to be create a tax efficient structure w/o a brokers license to form an LLC?
Wayne Brooks
Real Estate Professional from West Palm Beach, Florida
replied over 2 years ago
Here anyway, your license is always held in your individual name, but your independent contractor agreement with your broker can be in a PA, LLC, etc and that is how you’d get paid. Talk to your broker.
Dominic Bouchard
Professional from Los Angeles, California
replied over 2 years ago
@Andrew Moore
It might be better to create an S-Corp instead simply because of the cost and the fact that you'll receive similar benefits. I would examine carefully this route.
Plus, in some instance, even with your license own by an LLC it won't protect the asset if any issues arise. The responsibility would be to the broker personally in some instances anyway and not the LLC.
But as always I'd recommend consulting to evaluate everything correctly.
Hope that helps
Emily B.
Rental Property Investor from Greater Lansing Area, MI
replied over 2 years ago
If you aren't a broker, you can't hang your license with your own LLC, until that LLC has a broker's license. That's more the issue I see as to why people would say that. Hanging with an LLC isn't an issue, it's whether the LLC is licensed or not.