How to Structure SFH for Tax Purposes

Question

I've recently rented out my SFH and curious about how I should structure the business. I don't plan on occupying it any longer in the future. Put in LLC or not? How will it affect my taxes next year?

Joe Splitrock · Answer

LLC has no effect on taxes, it is only for liability protection. Right now you are renting this as a single proprietor, which is a type of business where you personally own. You will want to meet with a tax professional to discuss expense tracking. First year can be especially difficult, because you are setting up depreciation and doing a partial years expenses for taxes and insurance.