When do you pull trigger on creating LLC

Question

What parameters do you use when deciding whether or not to create an LLC for your property?

I’m looking to buy a small multifamily home and use a medium term rental strategy in Albany, NY. I’ll owner occupy. It will be my first property.

Any suggestions?

Nate Monson · Answer

Hi Account Closed I think in general creating an LLC is a good idea. Not doing so is taking a risk but if you are going to be owner occupying it, you'll be able to keep a much closer eye on things I can see an argument for not doing so.

In the contracting phase I've seen people put a clause in their contract that allows them to assign interest into an LLC. Of course you'll always want to consult your real estate attorney before making any decisions.

Caroline Gerardo · Answer

Owner occupied using government loans (FHA VA USDA Conventional) means you do not use a LLC.

Transferring back and forth from a LLC once you own is a sale and there are income tax and property tax consequences.

If you are doing more than 5 units multifamily, then you may want to spend the money for attorney and CPA to generate what meets your needs.

Get good insurance and meet health and safety codes.

Hamp Lee III · Answer

There are ways for asset protection that includes a trust (revocable or irrevocable) with a LLC. I would recommend speaking with an attorney to help navigate the best structure for you.

In the future, I’ll be using an irrevocable trust with LLCs inside of it. I’ll probably place the remainder of my properties in LLCs as well, but an attorney will help you map it out.

Eliott Elias · Answer

I always put the property in an LLC if it is an investment property.

Basit Siddiqi · Answer

Are you in a high risk profession that gets litigated often - Doctors, health care professionals, etc, If yes, create an LLC.Are you in the deal with another person, create an LLC.

When do you pull trigger on creating LLC

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