All Forum Posts by: Mark S.
Mark S. has started 157 posts and replied 1278 times.
Post: Actually liqudate my 401k?
- Rental Property Investor
- Kentucky
- Posts 1,311
- Votes 528
Don’t do it.
Post: LLCs to hold out-of-state RE
- Rental Property Investor
- Kentucky
- Posts 1,311
- Votes 528
Originally posted by @Wesley W.:
No worries, you've been very helpful. It sounds like you are putting all your properties into LLC, however. Are you concerned about mitigating risk over multiple entities?
Not really concerned at this point. In addition to the return components of the strategy, one "asset protection" feature that I'm "using" is intentionally keeping the properties highly leveraged (80% LTV with no immediate plans to accelerate payments). By keeping equity positions low, I feel like this lightens the target on my back. I also have very reputable, highly-experienced property management companies managing the properties which I feel also further reduces my risk. If one views the (deductible) property management fee as multi-faceted ("asset protection" in the form of professional management in addition to all the other PM functions), it's well worth it. All my properties have offer $1MM of liability protection and premiums are very affordable (I get the group rate offered to all the individual investors that use the PM and/or turnkey provider). Finally, the cost to set up, maintain, and track multiple LLCs for the small size of my current portfolio is also cost prohibitive at this time. For all these reasons, I am perfectly comfortable with this strategy at this time. As my portfolio grows, property type changes, etc., I will continue to evaluate the cost/benefit. Hope this helps.
Post: LLCs to hold out-of-state RE
- Rental Property Investor
- Kentucky
- Posts 1,311
- Votes 528
Originally posted by @Wesley W.:
So, in TN you you have to pay $300/yr to have an out of state LLC? And a $175/yr. fee for any LLC, regardless of origin?
How much does it cost one to get an LLC in TN? Seems like it might be worth it to get a KY LLC if the breakeven point is only a handful of years.
As a comparision, forming an LLC in NY is about $750+, but no other fees except $9 every two years. Not sure about foreign LLCs, but we don't have too many people out of NY that are looking to invest here. ;)
Attorney in KY set up KY LLC at his fee to do so (about $450).
KY has their own Limited Liability Entity Tax (LLET) of $175 each year. This is NOT a formation fee. This is NOT, and is SEPARATE from, annual filing fees, etc.
TN has a $300/yr foreign entity registration fee.
I pay both of these each year. Each additional rental helps spread the cost to make it more easily palatable.
I initially planned to use the LLC in KY and also live in KY and therefore I had it set up in KY. I later decided to invest in TN and therefore, instead of creating a new TN LLC, I simply registered my existing KY LLC in TN.
It sounds like you should consult an attorney to answer your specific questions regarding your specific situation. I am not an attorney and simply stating what happened to work for me in my particular circumstances.
Post: LLCs to hold out-of-state RE
- Rental Property Investor
- Kentucky
- Posts 1,311
- Votes 528
Depends on the state. TN is $300/yr for foreign entity. KY has LLET of $175/yr no matter what, in addition to other fees. Research your states of interest and that should give you an idea.
Post: LLCs to hold out-of-state RE
- Rental Property Investor
- Kentucky
- Posts 1,311
- Votes 528
Yes. I have KY SMLLC that is registered as foreign entity and holds property in TN. You just have to pay fees and keep current in both states.
Post: Investing in Turnkey International Coffee Farms
- Rental Property Investor
- Kentucky
- Posts 1,311
- Votes 528
Originally posted by @Ryan Holland:
@Mark S. Have you received any income yet? I'm curious to hear how this has been working out for you.
Too soon to tell. No income yet, but none is expected on the raw land parcel I purchased until 3-4 years. Most frustrating part is the deeding process. Because of this, I believe they’re making changes to future offerings.
Post: When are taxes due on a cashed out 401k?
- Rental Property Investor
- Kentucky
- Posts 1,311
- Votes 528
Why are you considering liquidating $300K in a lump sum?
Post: Stessa for Managing Real Estate Data?
- Rental Property Investor
- Kentucky
- Posts 1,311
- Votes 528
@Doug Schorr
I just started using it today. So far, so good for the most part. I’m very surprised about people and linking banking. I’ve been using Personal Capital for years and never had any issues and I imagine Stessa, Mint, and the rest of them all have similar security. I believe they’re only able to use and automatic screen-scraping and can’t do any sort of transactions (which would likely require two-factor authentication, at a minimum, anyway, and likely much more).
I went ahead and added a few reserve numbers that I usually include in my BP rental analysis and my spreadsheets (like vacancy, cap-ex reserve [even though they have a place for actual cap-ex, I still input cap-ex reserve and maintenance numbers all in maintenance]). I also input vacancy in the Admin & Other field to get a sense of TRUE cash flow (even though their formula doesn’t factor cap-ex or vacancy in the monthly cash flow). I feel the need to account for it somewhere.
Post: Convert from QuickBooks to Stessa?
- Rental Property Investor
- Kentucky
- Posts 1,311
- Votes 528
@Justin R.
Just started using it today, mostly for performance tracking, and haven’t really gotten too much into much else yet. What’s the play here? It can’t be free forever. What/where’s the pitch/upsell?
Post: Financial structure for first investment property
- Rental Property Investor
- Kentucky
- Posts 1,311
- Votes 528
What kind of rents are you expecting for a $1.2M purchase price?