#AskBP 013: Should I Have Several LLCS For My Real Estate Business?

by | BiggerPockets.com

LLCs can be incredibly important for your investing, but should YOU get one? Should you get multiple LLCs? In this episode of the #AskBP Podcast, Brandon shares his (non-CPA, non-lawyer) thoughts on the concept of an LLC and whether you should have one for your business. Don’t miss this incredible episode!

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About Author

Brandon Turner

Brandon Turner (G+ | Twitter) spends a lot of time on BiggerPockets.com. Like... seriously... a lot. Oh, and he is also an active real estate investor, entrepreneur, traveler, third-person speaker, husband, and author of "The Book on Investing in Real Estate with No (and Low) Money Down", and "The Book on Rental Property Investing" which you should probably read if you want to do more deals.


  1. Jeffrey Hare

    Brandon: You made a good point about investors who question the cost of seeking professional advice in setting up the proper entity for their investment strategy: if you can’t afford the advice, you probably aren’t ready for it. Many new investors get tricked into spending more money on asset protection than assets when they start out. If they make mistakes, they can be costly and distracting. Another caution I would add to your podcast is to make sure you have your entity registered in the state where you own the property, and check your home state (where you live) for the requirements to file tax returns for your home state when you are a managing member of an LLC in another state. As you said, talk to your CPA and your attorney before you waste a lot of money.

  2. Joe Foster on

    I have multiple LLCs, but none for the properties I own. The LLCs are used for private lending partnerships, the operating agreement defines the contributions, partners, and percentages. Because my partners (so far) have been trustworthy, we generally do not have any issues. The LLCs are short lived.

    Why my properties are not in LLCs, I’m not a lawyer….

    With that said, for the properties a couple of areas that was missed in your blog was the entire concept of liability and “piercing the corporate veil”. If you have the property in an LLC and you are doing the work personally on the property, *you* are liable because it was *you* doing the work. Consider that ya hang a ceiling fan, it falls and someone gets hurt. You hung the fan, not the LLC. This one I heard from a lawyer. To protect for this, ya need a blanket liability policy. These are cheap, until your kids start driving, but that’s another story. For $2M, mine is $170 a year. When the kid goes on it for driving it will hit $400.

    Depending on the state, I live in NC, the LLC costs about $125 to setup and another $1xx every year to maintain if you file the paperwork yourself. To have a lawyer do it the first time cost me north of $400. At tax time my K1 cost $400 a piece by the account.

    Closing, the only people that have told me that an LLC is worthwhile for my properties are the people with something to gain, the lawyers and the accountants.

    • Jeffrey Hare

      What is your objective? Most often, the most helpful answer to a question about the “best way” or the “right way” to manage an aspect of real estate investing depends on your individual objective. A land trust may — or may not — be the solution to your investment objective. The same goes for answers to questions such as “should I have more than one LLC?” or “should I hold title to real estate in an LLC or an S-Corporation?” One size does not fit all. Providing some context will hopefully permit those with unique knowledge or expertise to provide you with a correct and practical response.

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