All Forum Posts by: Joshua Bailey
Joshua Bailey has started 1 posts and replied 3 times.
Post: Create an individual LLC per investment property?
- Posts 3
- Votes 1
Quote from @Tony Savage:
I form LLC's base on the amount risk/exposure I'm willing to bear. Here is an example: If I have 2 rentals and they have 200K or less in equity, I will put both in one LLC because I can bear the 400K exposure. If you have rentals that have 200K+ in equity, you can put them in their own LLC's. As you grow your portfolio, your tolerance for exposure will increase. This is the model that I follow for my rental portfolio.
If you want anonymity, start with forming a holding LLC in Wyoming. Your holding LLC will then own your rental LLC. Makes it a challenge for people that want to sue you to find you.
This makes sense, thank you! Only thing about the Wyoming LLC and C-corps, etc is I don't believe I'm at the level where that makes sense for me to up keep the entity's with all the associated costs
Post: Create an individual LLC per investment property?
- Posts 3
- Votes 1
Quote from @Kevin Sobilo:
@Joshua Bailey, there are many valid viewpoints on this and I don't want to try to give any exhaustive opinion.
However, I will make one comment about what you stated. The specific state can play a factor in your choice. In some states the cost to obtain and to maintain an LLC is negligible but in others its significantly more. If you are in an expensive state, having a separate LLC per property might be too expensive to justify unless the equity in a given property is sufficiently large.
I personally view it as a liability protection issue and base the decision on my costs to have the LLC versus the equity contained within. Having 10 low value properties within a single LLC might make sense while having a single LLC dedicated to an expensive asset may also make sense.
Gotcha, so really a big factor is having a massive amount of equity to protect. thank you for your response
Post: Create an individual LLC per investment property?
- Posts 3
- Votes 1
Heard very mixed things about this topic. Thinking this is the way to go for easy accounting purposes. The idea I've seen and heard is that you create an individual LLC per investment property you own for a couple important reasons. 1.) Limited liability through the LLC owning the property rather than one entity owning several. 2.) easy accounting by creating a specific bank account for the LLC (property) where rents go in and specific mortgage and other expenses come out. 3.) I thought of was anonymity protection, however does this matter that much anymore with the new Fincen and reporting laws? any ideas or suggestions would be appreciated.