All Forum Posts by: Antonio Hopkins

Presley, 

Okay, I am sitting down with a CPA sometime next week to see which will work best.  I found a lender that would mortgage me under a business, but it has the variable balloon, so I prefer to go with it under my personal. The only issue I was wondering about is if I will pay a substantial amount more in taxes. If I have it under an S-Corp then I will only pay on earnings of the business, but if I did it under my personal it would be my income plus the investment return.  For example, income investment $3600 and then taxed 18% on this, but if I did it under my name it would be $3600+64000 (my income- not actual) and then taxed 18% of that.  I am just wondering if I am correct on this aspect, or if I am worrying for nothing.

Thanks,  

Al,

So I won't have to pay more in taxes due to my earnings if I do it under my personal?

I am looking at buying an investment property. I have talked to a couple of different lenders, and they quoted me 25% down and a fixed interest rate for 15 years at 3.75%, but here's the catch, this is only if I put the property under my name. If I don't and put it into an LLC or S-Corp, I am looking at 25% down and then a variable interest rate starting at 3.75%-7% with a 3-year balloon that is re-assessed and is changed depending on the market. My question is should I put it in an S-Corp or LLC or just put it under my name? I am not worried about the liability implications because I have landlord insurance along with an umbrella policy. My worry is the tax implications.

The reason I ask is because if the interest rate stays at 3.75%, I can make a pretty good return on my investment, but if the interest rate goes up to 7%, there is not much left for profit, especially if the three-year assessment rises more than 7%. The only issue I am wondering about is how much will I be taxed if I left it under my name, rather than an S-Corp/ LLC? I am sure someone has faced a similar dilemma before. Please provide some advice.

Thanks,

Hello, 

I am a new investor and am looking to make some good moves now, so I can live comfortably for the future!